As filed with the Securities and Exchange Commission on November 30, 2012

Registration No. 333-175393

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

Amendment No. 9

to

Form S-1

Registration Statement Under The Securities Act of 1933

Silver
Spring Networks, Inc.

(Exact name of registrant as specified in its charter)

Delaware

3576

43-1966972

(State or other jurisdiction of

incorporation or organization)

(Primary Standard Industrial

Classification Code Number)

(IRS Employer

Identification No.)

Silver Spring Networks, Inc.

555 Broadway Street

Redwood City, California 94063

(650) 298-4200

(Address, including zip code, and telephone number, including area code, of Registrants principal executive offices)

Scott Lang

Chairman of the Board, President and Chief Executive Officer

Silver Spring Networks, Inc.

555 Broadway Street

Redwood City, California 94063

(650) 298-4200

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Please send copies of all communications to:

Gordon K. Davidson, Esq.

Robert A. Freedman, Esq.

Sayre E. Stevick, Esq.

Michael A. Brown, Esq.

Fenwick & West LLP

801 California Street

Mountain View, California 94041

(650) 988-8500

David B. Leeb, Esq.

Silver Spring Networks, Inc.

555 Broadway Street

Redwood City, California 94063

(650) 298-4200

Alan F. Denenberg, Esq.

Sarah K. Solum, Esq.

Davis Polk & Wardwell LLP

1600 El Camino Real

Menlo Park, California 94025

(650) 752-2000

Approximate date of commencement of proposed sale to the public: As soon as practicable after
this registration statement becomes effective.

If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box: ¨

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement
number of the earlier effective registration statement for the same offering. ¨

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. ¨

If this
Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering. ¨

Indicate by check mark whether the registrant is a
large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2
of the Exchange Act. (Check one):

Large accelerated filer

¨

Accelerated filer

¨

Non-accelerated filer

x (Do not check if a smaller reporting company)

Smaller reporting company

¨

The Registrant hereby amends this registration statement on such date or dates as may be necessary to
delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the
registration statement shall become effective on such date as the Commission acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these
securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the
offer or sale is not permitted.

PROSPECTUS
(Subject to Completion)

Issued November 30, 2012

Shares

COMMON STOCK

Silver Spring Networks, Inc. is
offering shares of its common stock. This is our initial public offering and no public market exists for our shares. We anticipate that the initial public offering price will be
between $ and $ per share. Concurrently with the closing of this offering, entities affiliated with
Foundation Capital will purchase from us in a private placement shares of common stock with an aggregate purchase price of approximately $12 million, at a price per share equal to the initial public offering price.

Our common stock has been approved for listing on the New York Stock
Exchange under the symbol SSNI.

We are an emerging growth company as defined under federal securities laws. Investing in our common stock involves risks. See Risk Factors beginning
on page 17.

PRICE
$ A SHARE

Price to

Public

Underwriting

Discounts and

Commissions

Proceeds to

Silver Spring

Networks

Per share

$

$

$

Total

$

$

$

Silver Spring Networks, Inc. has granted
the underwriters the right to purchase up to an additional shares of common stock to cover over-allotments.

The Securities and Exchange Commission and state securities regulators have not approved or disapproved these securities, or
determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The underwriters expect to deliver the shares of common stock to purchasers
on , 2012.

We have not, and the underwriters have not, authorized anyone to provide any information or to make any representations other than those
contained in this prospectus or in any free writing prospectuses we have prepared. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. We are offering to sell, and
seeking offers to buy, shares of our common stock only in jurisdictions where offers and sales are permitted. The information in this prospectus or a free-writing prospectus is accurate only as of its date, regardless of its time of delivery or any
sale of shares of our common stock. Our business, financial condition, results of operations and prospects may have changed since that date.

Through and including
, 2012 (25 days after the commencement of this offering), all dealers that buy, sell or trade shares of our common stock,
whether or not participating in this offering, may be required to deliver a prospectus. This delivery requirement is in addition to the obligation of dealers to deliver a prospectus when acting as underwriters and with respect to their unsold
allotments or subscriptions.

For investors
outside the United States: We have not, and the underwriters have not, done anything that would permit this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than in the
United States. Persons outside the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to, the offering of the shares of common stock and the distribution of this prospectus
outside of the United States.

This summary highlights information contained elsewhere in
this prospectus and does not contain all of the information you should consider in making your investment decision. Before deciding to invest in shares of our common stock, you should read this summary together with the more detailed information,
including our consolidated financial statements and the related notes, provided elsewhere in this prospectus. You should carefully consider, among other things, the matters discussed in Risk Factors, our consolidated financial statements
and the related notes, and Managements Discussion and Analysis of Financial Condition and Results of Operations, in each case included elsewhere in this prospectus.

SILVER SPRING NETWORKS, INC.

Overview

We provide a leading networking platform and solutions that enable utilities to transform the power grid
infrastructure into the smart grid. The smart grid intelligently connects millions of devices that generate, control, monitor and consume power, providing timely information and control to both utilities and consumers. We believe that the
application of networking technology to the power grid has the potential to transform the energy industry through better communication just as the application of networking technology to the computing industry enabled the Internet.

We believe the power grid is one of the most significant
elements of contemporary industrial infrastructure that has yet to be extensively networked with modern technology. We were founded in 2002 to address this challenge, pioneering a fundamentally new approach to connect utilities with millions of
devices on the power grid. We believe our technology will yield significant benefits to utilities, consumers and the environment, both in the near term and the future. These benefits include more efficient management of energy, improved grid
reliability, capital and operational savings, the ability to pursue new initiatives, consumer empowerment, and assistance in complying with evolving regulatory mandates through reduced carbon emissions. We believe networking the power grid will
fundamentally transform the worlds relationship with energy.

The foundation of our technology is a standards-based and secure Internet Protocol, or IP, network. Our networking platform provides two-way communications between the utility back office and devices on
the power grid. In addition to our networking platform, we offer a suite of solutions that run on top of our network and complementary services, all of which we collectively refer to as our Smart Energy Platform. Our solutions include
advanced metering, which allows utilities to automate a number of manual processes and improve operational efficiencies, offer flexible pricing programs to consumers, and improve customer service with faster outage detection and restoration;
distribution automation, which provides utilities with real-time visibility into the health of the grid, enabling better management and control of power distribution assets to improve grid reliability; and demand-side management, which enables
utilities to offer consumers a variety of programs and incentives to use energy more efficiently and reduce usage at times of peak demand. Our service offerings include professional services to implement our products, managed services and software
as a service, or SaaS, to assist utilities with managing the network and solutions, and ongoing customer support. Our Smart Energy Platform comprises hardware, software and services and combines with devices manufactured by third-party
partners to form end-to-end smart grid offerings. We have architected our networking platform to support multiple current and future smart grid solutions. As a result, we believe utilities can increase the value of their network investment as they
deploy additional solutions on this network.

We
market our Smart Energy Platform directly to utilities around the world. Leading utilities have selected our networking platform to be the foundation of the smart grid. According to an analysis prepared by IDC Energy Insights, we are the
United States market leader for electric advanced metering infrastructure communications,

with 32% of homes and businesses awarded from 2002 through September 30, 2012. IDC Energy Insights prepared this analysis at our request and we paid a customary fee for its services. Since
inception, we have been awarded contracts to network more than 22 million Silver Spring-enabled devices that connect homes and businesses, of which more than 13 million have been networked as of October 31, 2012. Our utility customers, as
of October 31, 2012, include: Atlantic City Electric Company, a subsidiary of Pepco Holdings, Inc., or PHI; Baltimore Gas and Electric Company, a subsidiary of Exelon Corporation; CitiPower Pty and Powercor Australia Ltd, or CHED, subsidiaries
of CHEDHA Holdings Pty Limited; Commonwealth Edison Company, a subsidiary of Exelon Corporation; CPFL Energia; Delmarva Power and Light Company, a subsidiary of PHI; Florida Power & Light Company, or FPL, a subsidiary of NextEra Energy, Inc.;
Guelph Hydro Electric Systems, Inc; Jemena Electricity Networks (Vic) Ltd; Modesto Irrigation District, or MID; Oklahoma Gas and Electric Company, or OG&E, a subsidiary of OGE Energy Corp.; Pacific Gas and Electric Company, or PG&E, a
subsidiary of PG&E Corporation; Potomac Electric Power Company, a subsidiary of PHI; Progress Energy Carolinas, Inc. and Progress Energy Florida, Inc., subsidiaries of Progress Energy, Inc.; and Sacramento Municipal Utility District, or SMUD.

As of
, our total backlog was $ million and represents future product and service billings that we expect to generate pursuant to contracts that we have
entered into with our utility customers and meter manufacturers. See Risk FactorsAmounts included in our total backlog and order backlog may not result in actual billings or revenue or translate into profits. and
BusinessTotal Backlog.

For the
years ended December 31, 2009, 2010 and 2011 our total revenue was $3.3 million, $70.2 million and $237.1 million, respectively. In the same periods, we generated billings of $195.6 million, $261.4 million and $236.1 million,
respectively. For the nine months ended September 30, 2011 and 2012, our total revenue was $175.7 million and $146.7 million, respectively, and our billings were $183.3 million and $218.8 million, respectively. In addition,
for the years ended December 31, 2009, 2010 and 2011 and the nine months ended September 30, 2012, we incurred gross profit (loss) of $(36.8) million, $(50.0) million, $23.0 million and $21.2 million, respectively, and incurred net
loss of $(113.5) million, $(148.4) million, $(92.4) million and $(68.7) million, respectively. To date, a substantial majority of our revenue and billings has been attributable to a limited number of utility customer deployments of our
networking platform and advanced metering solution. Our distribution automation, energy efficiency and demand response solutions are being piloted and deployed by some of our utility customers and, to date, we have recognized limited revenue and
billings on these solutions as compared with those of our advanced metering solution. Please see Selected Consolidated Financial DataOther Financial Measures and Managements Discussion and Analysis of Financial
Condition and Results of OperationsKey Elements of Operating and Financial Performance for more information on billings.

Our Opportunity

Much of todays power grid infrastructure is antiquated, is not automated and has only recently begun to incorporate modern
networking technology. Networking the grid will allow utilities and consumers to more efficiently generate, control, monitor and consume energy. Numerous forces are making such initiatives critical for utilities throughout the world, including:

The Antiquated Power Grid Cannot Keep Pace
with Accelerating Demand. Economic development, population growth and the proliferation of new power-consuming devices are expected to increase global demand for power. At the same time, the construction of new power-generating capacity to
meet this demand is expected to be constrained by impediments such as high costs, permitting obstacles, regulatory hurdles and environmental considerations. We believe these constraints will create an imbalance that is further exacerbated by the
aging power grid infrastructure.

Todays Power Grid is Incapable of Effectively Integrating Emerging
Technologies. Much of todays power grid infrastructure is based on a centralized generation model in which devices at the end of distribution lines merely consume power. Without two-way communications, the power grid cannot accommodate
advanced technologies such as demand-side management programs, renewable-generation sources, grid-powered electric vehicles and distributed storage.

Todays Power Grid Lacks the Capability to Engage and Empower Consumers. Many utilities desire to enhance the
relationship with their consumers to improve the consumer experience and enhance operational efficiency. We also believe that, given consumer adoption of sophisticated information technology tools, heightened awareness of environmental issues and
rising energy costs, many consumers will seek to play an increasingly active role in managing their energy use. Much of todays power grid lacks the ability to deliver such enhanced interaction between utilities and their consumers.

Utilities are Under Pressure to Adapt to Changing
Policies. Around the world, a heightened focus on the environment and energy security has driven policies that support new utility rate structures that promote energy efficiency, increase renewable generation and limit greenhouse gas
emissions. The global power grid infrastructure will require new technologies to enable utilities to comply with these new policies and adapt to these changing dynamics.

While these forces vary across geographies, addressing them
requires the transformation of todays power grid into the smart grid through the deployment of networking technology. According to Pike Research, the global market for advanced metering, distribution automation, demand-side management and
related services is estimated to grow from $7.0 billion in 2010 to $19.5 billion by 2015, a compounded annual growth rate of 22.7%. Pike Research prepared this analysis at our request and we paid a customary fee for its services.

Our Technology and Solution

The foundation of our technology is a standards-based and
secure IP network. Our network is composed of our hardware such as access points and relays, our UtilOS network operating system, and our GridScape software suite, which together provide utilities the ability to communicate with and control devices
connected to the power grid. We also offer a suite of solutions that run on top of our network including advanced metering, distribution automation, and demand-side management. These solutions include additional hardware, such as our communications
modules and bridges, and applications from our UtilityIQ and CustomerIQ software. Our solutions combine with devices from the large number of third parties with whom we collaborate to form end-to-end smart grid offerings built on our network. In
addition, we offer a wide range of services that enable our utility customers to deploy, operate and maintain our networking platform and solutions. These service offerings include professional services to implement our products, managed services
and SaaS to assist utilities with managing the network and solutions, and ongoing customer support.

Key Features and Benefits of Our Networking Platform

We have designed and built our networking platform from the ground up for the sole purpose of enabling utilities to transform the power
grid infrastructure into the smart grid. We believe our utility customers benefit in the following ways:

Standards-Based. Our networking platform is based on standard IP, which enables utilities to deploy standards-based networking
throughout their infrastructure and allows for interoperability with other standards-based devices. As a result, we believe utilities can readily extend our networking platform to support a broad set of end-to-end smart grid offerings in a
cost-effective and timely manner. Device choice also gives utilities the ability to deploy best-in-class products.

High-Performance. Our networking platform delivers high-bandwidth, low-latency
performance and traffic prioritization, which allows utilities to run multiple solutions including those that require high-throughput communications, such as distribution automation, while maintaining robust operating performance.

Scalable. Our networking platform can be deployed
rapidly at scale to accommodate millions of devices on the power grid, allowing utilities that deploy our networking platform to easily and cost-effectively expand beyond the scope of their initial deployments.

Extensible. Our communications modules are designed
with ample processing power and memory to support future functionality. This design enables us, for example, to deliver software over the air, allowing us to augment the functionality of, and to deploy new solutions and applications to, previously
deployed hardware. As a result, we believe our utility customers can mitigate the risk of technology obsolescence.

Increasing the Efficiency of the Power Grid. With our advanced metering and distribution automation solutions, utilities can more effectively and efficiently deliver electricity to homes and
businesses with less waste. Historically, utilities have had limited visibility into the voltage levels at consumers locations, requiring the utilities to send more power down the lines to ensure adequate voltage. With our products, utilities
can monitor actual voltage levels at each consumers location and adjust system voltage remotely, improving energy efficiency.

We believe we have a number of unique advantages that
position us for continued leadership and growth in providing the networking platform and solutions utilities use to transform the power grid infrastructure into the smart grid. Our competitive strengths include:

Premier Purpose-Built Network for the Smart
Grid. The core of our technology is the network, which was designed and built from the ground up for the specific purpose of addressing the stringent requirements of the smart grid. Alternative solution providers often repurpose networking
technologies that have not comprehensively addressed the challenging requirements of the smart grid. Other providers have expertise rooted in meters and other grid devices rather than in networking. We believe our purpose-built network is
best-in-class.

Innovative
Technology. We built our networking platform through our focused development of core networking, communications, semiconductor and power electronics technologies. In 2006, we developed what we believe was the first IPv6 networking platform
that enabled two-way communications between utilities and millions of devices connected to the power grid. Since then, we have continued to add features and functionality to improve our networking platform. Gen4, our next-generation networking
technology, is available in some products today, with more products coming later this year and next year. The technology features a modular architecture and will support faster performance, more memory and an integrated cellular option, adding more
flexibility and choice for our utility customers.

Field-Proven Performance. We have deployed what we believe to be the worlds largest IPv6 network enabling the smart grid. Our networking platform has been operating in the field under
live conditions for several years. As of October 31, 2012, we had networked more than 13 million Silver Spring-enabled devices that connect homes and businesses for leading utilities. For the nine months ended September 30, 2012, we
delivered 99.9% system availability of our Utility IQ advanced metering solution for the networks that we manage. Our proven ability to deliver consistent performance to some of the worlds most demanding utilities differentiates us from our
competitors.

Low Total Cost of
Ownership. We designed our networking platform to be high-performing, flexible and capable of supporting multiple solutions. As a result, we believe utilities can reduce their capital and operational expenditures by leveraging a single
platform as compared to alternatives that will likely require the deployment of additional, duplicative networks to support additional solutions. We believe for every solution that utilities add to our networking platform, they further reduce their
total cost of ownership when compared to alternative approaches.

Blue Chip Utility Customers. Our customer base consists of some of the largest and most recognizable utilities in the United States and Australia. Our close working relationships provide us
with early and deep insight into their needs and future requirements, which then drives our development efforts. When new projects arise with these customers, we believe our relationships position us well to compete for their business. In addition,
our existing utility customers often serve as strong references when we compete for business from new utility customers.

Interoperability with Industry-Leading Partners. We work closely with a number of vendors, including meter manufacturers, to
develop end-to-end offerings for utilities that implement our standards-based networking platform. Our solutions are designed to interoperate with the products of more than 60 vendors, providing our utility customers with the flexibility to
choose from a wide range of products. For example, when deploying our advanced metering solution, our utility customers can select meters offered by several different manufacturers. As we continue to increase the number of vendors with whom we
collaborate, our utility customers will benefit from the resulting innovation, helping establish our networking platform as the industry standard.

Our objective is to provide the leading networking platform
and solutions that enable utilities worldwide to transform the power grid into the smart grid, ultimately becoming the industry standard. To achieve this objective, we intend to:

Exceed our Customers Expectations. We
seek to differentiate ourselves from our competitors through superior product reliability, performance and service. We believe that this focus has strengthened our relationships with our existing utility customers.

Enlarge our Network Footprint. As our
networking platform has been demonstrated at scale, we have succeeded in attracting additional utility customers. By expanding our footprint, we not only realize the revenue associated with the initial contract but also gain an opportunity to sell
additional solutions and services to these customers in the future. As a result, we are focused on winning new deployments with the goal of becoming the networking platform of choice for leading utilities worldwide.

Expand Internationally. Our goal is to
be the leader in every market we enter. We believe the smart grid has become a priority for utilities worldwide, and to address this opportunity we plan to aggressively invest in our products, marketing efforts and delivery capabilities to serve
international markets including Australia, South America, Europe and Asia.

Broaden our Solutions and Services. We strive to broaden the scope of our solutions and services to maximize the benefit our utility customers receive from having deployed our Smart
Energy Platform. This expansion includes providing existing utility customers with additional solutions and services from our current portfolio and developing new solutions and services to address our utility customers evolving
requirements.

Extend our Technology
Leadership. We intend to continue to invest in research and development to further enhance our technology leadership. Since the deployment of our networking platform, we have been able to simultaneously reduce hardware production
costs while materially enhancing its functionality. Over the long term, we believe our networking platform has the potential to be extensible to areas beyond energy, enabling the internet of things, where physical devices gain the capacity to
communicate with each other through the application of networking technology.

We believe that by continuing to execute our strategy and connect additional homes and businesses, we will experience a network effect that will establish our Smart Energy Platform as the global
standard.

Key Challenges and Selected Risk Factors

We face a number of key challenges in
achieving our objectives as discussed more fully in the section entitled Risk Factors. Some of these challenges include:



Utilities generally have extensive budgeting, procurement, competitive bidding, technical and performance review, and regulatory approval processes
that can take up to several years to complete. This extended sales process requires us to dedicate significant time by our senior management, and sales and marketing and customer services personnel, and to use significant financial resources without
any assurance of success.



Our industry is highly competitive and characterized by new and rapidly evolving technologies, standards, regulations, customer requirements, and
frequent product introductions. The process of developing new technologies and products is complex, and if we are unable to develop enhancements to, and new features for, our existing products or acceptable new products that keep pace with
technological developments or industry standards, our products may become obsolete, less marketable and less competitive.

If any of our products contain a defect, compatibility or interoperability issue or other error, we may have to devote significant time and resources
to find and correct the issue. Such efforts could divert the attention of our management team and other relevant personnel from other important tasks. A product recall or a significant number of product returns could: be expensive; damage our
reputation and relationships with utilities, meter vendors and other third-party vendors; result in the loss of business to competitors; and result in litigation against us.



The adoption of the smart grid is evolving and is impacted by multiple factors. In 2010, the rate of smart grid adoption slowed due to uncertainty
surrounding the timing and tax treatment of U.S. government stimulus funding, negative publicity and consumer opposition, and regulatory investigations. These uncertainties caused many potential utility customers that had been considering smart grid
programs in the United States to further evaluate their smart grid initiatives and delay their procurement processes or extend their deployment schedules. Smart grid adoption in international markets has trailed adoption in the United States as
international markets continue to explore the technology and define the benefits and regulatory requirements for the smart grid. Any of the foregoing factors could directly impact our current or future deployments, as well as inhibit the growth of
the overall smart grid market.

In addition, our business is subject to numerous risks and uncertainties that you should understand before making an investment decision.
These risks are discussed more fully in the section entitled Risk Factors. Some of these risks include:



We have a history of losses and anticipate continued losses and negative operating cash flow for the foreseeable future, and we may not achieve or
sustain profitability on a quarterly or annual basis.



Our quarterly results are inherently unpredictable and subject to substantial fluctuations, and, as a result, we may fail to meet the expectations of
securities analysts and investors, which could adversely affect the trading price of our common stock.



Our revenue is not predictable and recognition of a significant portion of it will be deferred into future periods.



Amounts included in our total backlog may not result in actual billings or revenue or translate into profits.



We are dependent on the utility industry, which has experienced volatility in capital spending. This volatility could cause our results of operations
to vary significantly from period to period.



Substantially all of our current products depend on the availability and are subject to the regulation of radio spectrum in the United States and
abroad.



A limited number of our utility customers are responsible for a significant portion of our billings, revenue and cash flow. A decrease in sales to
these utility customers could have a material adverse effect on our operating results and financial condition.



Security breaches involving our smart grid products or services, publicized breaches in smart grid products and services offered by others, or the
public perception of security risks or vulnerability created by the deployment of the smart grid in general, whether or not valid, could harm our business.



We and our utility customers operate in a highly regulated business environment and changes in regulation could impose costs on us or make our products
less economical.



Our utility customer contracts typically contain provisions that could cause us to incur penalties, be liable for damages, and/or incur unanticipated
expenses with respect to the functionality, deployment, operation and availability of our products and services, and that provide the customer with the right to terminate the contract for any reason.

We have entered into a warrant amendment agreement with
entities affiliated with Foundation Capital to provide that all warrants to purchase shares of our capital stock held by these entities will terminate immediately prior to the effectiveness of this Registration Statement in exchange for the
aggregate payment by us of $12 million to these entities, which will be paid from our existing cash balance. We have also entered into a purchase agreement whereby these entities have agreed to purchase an aggregate of $12 million of shares of our
common stock in the concurrent private placement at the same price as the price offered to the public in this offering.

Corporate Information

We were incorporated in the State of Delaware on July 3, 2002 as Real Time Techcomm, Inc. On August 6, 2002, we changed our name
to Silver Spring Networks, Inc. Our principal executive offices are located at 555 Broadway Street, Redwood City, California 94063, and our telephone number is (650) 298-4200. Our website address is www.silverspringnetworks.com. The
information on, or that can be accessed through, our website is not part of this prospectus.

Except where the context requires otherwise, in this prospectus, Company, Silver Spring, Registrant, we, us and our refer to Silver
Spring Networks, Inc. and its subsidiaries.

The
marks UTILOS, UTILITYIQ and the SILVER SPRING NETWORKS Logo are our registered trademarks, and the marks CUSTOMERIQ, GREENBOX, GRIDSCAPE, SILVER SPRING, SILVER SPRING
NETWORKS, SMART ENERGY PLATFORM and UIQ are our trademarks. All other service marks, trademarks and tradenames appearing in this prospectus are the property of their respective owners.

Concurrently with this offering, entities affiliated with Foundation Capital will purchase from us in a private placement an aggregate of $12 million of shares of our common stock at the same
price as the price offered to the public in this offering, or shares based on an assumed initial public offering price of $ per
share, the midpoint of the range set forth on the cover of this prospectus. The sale of these shares to entities affiliated with Foundation Capital will not be registered in this offering. We refer to the private placement of these shares of common
stock as the concurrent private placement.

Shares of common stock to be outstanding after this offering and the concurrent private placement

shares

Use of proceeds

We plan to use the net proceeds of this offering and the concurrent private placement for general corporate purposes, including working capital and potential acquisitions. See Use of
Proceeds.

Risk factors

You should read the Risk Factors section of this prospectus for a discussion of factors to consider carefully before deciding to invest in shares of our common stock.

New York Stock Exchange symbol

SSNI

The number of shares of common stock that will be outstanding after this offering and the concurrent private placement is based on
shares of our common stock outstanding as of September 30, 2012. This number assumes the conversion of all outstanding shares of our
convertible preferred stock and our outstanding convertible notes based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus,
as discussed in further detail below, and excludes:



24,310,095 shares of common stock issuable upon the exercise of options outstanding under our equity incentive plans with a weighted average
exercise price of approximately $4.38 per share, which weighted average exercise price will be reduced to $ , based on an assumed initial public offering price of
$ per share, the midpoint of the range set forth on the cover of this prospectus, following the modification of stock options held by current employees and directors as of the date of this offering
with an exercise price of $6.98 per share or greater to reduce the exercise price to a price equal to the initial public offering price;



1,180,782 shares of common stock issuable upon the settlement of restricted stock units outstanding under our equity incentive plans, 468,829 of
which will be issued upon the effectiveness of the registration statement;



9,456,040 shares of common stock available for future issuance under our existing equity incentive plans and on the day our 2012 Equity Incentive
Plan becomes effective, any remaining shares available for future issuance will be added to the shares reserved for issuance under our 2012 Equity Incentive Plan and we will cease granting awards under our existing equity incentive plans;

17,000,000 shares of common stock reserved for future issuance under our 2012 Equity Incentive Plan, which will become effective on the day before the
date the registration statement is declared effective, including:



243,154 shares of our common stock that will be issuable upon the settlement of restricted stock units that vest upon the effectiveness of the
registration statement and 2,843,808 shares of our common stock that will be issuable upon the settlement of restricted stock units or the exercise of options to purchase common stock with an exercise price per share equal to the initial public
offering price that will vest over time, all of which will be granted on the day that this registration statement is declared effective and that were communicated to employees, but not granted, during the period between February 2012 and the date of
this prospectus; and



up to 10,000,000 shares of our common stock in equity awards that we expect to grant to existing employees, including executive officers, for
additional retention purposes shortly following the closing of this offering;



2,000,000 shares of common stock reserved for future issuance under our 2012 Employee Stock Purchase Plan, which will become effective on the day the
registration statement is declared effective; and



250,000 shares of common stock issuable upon exercise of a warrant at an exercise price of $0.001 per share,
shares of common stock issuable upon exercise of convertible preferred stock warrants that will convert into warrants to purchase shares of common
stock upon closing of this offering, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, at a weighted average
exercise price of $ per share. It also excludes warrants that will terminate immediately prior to the effectiveness of this registration statement as described in Certain Relationships and
Related Party TransactionsConcurrent Private Placement and Warrant Termination.

The number of shares of common stock outstanding after the offering and the concurrent private placement depends upon the initial public
offering price and will be adjusted if the initial public offering price is other than $ per share, the midpoint of the range set forth on the cover of this prospectus. As a result of anti-dilution and
conversion provisions that apply to our convertible preferred stock and convertible notes, a $1.00 decrease would increase the number of shares of common stock outstanding after the offering and the concurrent private placement by
shares, and a $1.00 increase would decrease the number of shares of common stock outstanding after the offering by
shares. Unless otherwise indicated, all information in this prospectus assumes:



the conversion of all outstanding shares of our convertible preferred stock into
shares of common stock effective immediately prior to the closing of this offering, which is based on an assumed initial public
offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus;



the issuance of shares of common stock upon the
conversion of our convertible notes, together with accrued interest thereon, that will occur immediately prior to the closing of this offering based on an assumed initial public offering price of $ per
share, the midpoint of the range set forth on the cover of this prospectus;



the conversion of warrants to purchase shares of our convertible preferred stock that do not expire at the closing of this offering into warrants to
purchase an aggregate of shares of common stock effective immediately prior to the closing of this offering, which is based on an assumed initial public offering price of
$ per share, the midpoint of the range set forth on the cover of this prospectus;



a -for-1 reverse stock split of our outstanding capital stock that was effected on
, 2012;



no exercise by the underwriters of their right to purchase up to an
additional shares of common stock to cover over-allotments; and



the effectiveness of our restated certificate of incorporation and restated bylaws upon the closing of this offering.

The following consolidated financial data should be read
together with our consolidated financial statements and related notes and Managements Discussion and Analysis of Financial Condition and Results of Operations appearing elsewhere in this prospectus. We have derived the following
consolidated statements of operations data for the years ended December 31, 2009, 2010 and 2011 and the consolidated balance sheet data as of December 31, 2011 from our audited consolidated financial statements included elsewhere in this
prospectus. We have derived the following consolidated statements of operations data for the nine months ended September 30, 2011 and 2012 and the consolidated balance sheet data as of September 30, 2012 from our unaudited consolidated
financial statements included elsewhere in this prospectus. The unaudited consolidated financial statements include, in our opinion, all adjustments, consisting only of normal recurring adjustments, that we consider necessary for the fair
presentation of the financial information set forth in those statements. Our historical results are not necessarily indicative of our results to be expected for the remainder of 2012 or in any future period.

Year Ended December 31,

Nine Months EndedSeptember 30,

2009

2010

2011

2011

2012

(unaudited)

(in thousands, except per share amounts)

Consolidated Statements of Operations Data:

Revenue, net

$

3,297

$

70,224

$

237,050

$

175,716

$

146,666

Cost of revenue(1)

40,060

120,248

214,099

163,829

125,495

Gross profit (loss)

(36,763

)

(50,024

)

22,951

11,887

21,171

Operating expenses:(1)

Research and development

25,518

47,022

57,510

42,874

46,872

Sales and marketing

14,869

21,063

25,221

18,725

21,732

General and administrative

18,388

27,475

34,353

26,804

21,024

Legal settlements and amortization of acquired intangibles

4,533

166

1,097

1,099



Total operating expenses

63,308

95,726

118,181

89,502

89,628

Operating loss

(100,071

)

(145,750

)

(95,230

)

(77,615

)

(68,457

)

Other income (expense), net

(13,212

)

(2,553

)

3,234

1,670

219

Loss before income taxes

(113,283

)

(148,303

)

(91,996

)

(75,945

)

(68,238

)

Provision for income taxes

180

146

363

253

469

Net loss

$

(113,463

)

$

(148,449

)

$

(92,359

)

$

(76,198

)

$

(68,707

)

Net loss per share, basic and diluted

$

(8.48

)

$

(9.20

)

$

(5.21

)

$

(4.33

)

$

(3.75

)

Weighted average shares used to compute net loss per share, basic and diluted

Total stock-based compensation expense and common stock warrant issuance cost

$

2,052

$

6,547

$

17,332

$

13,093

$

11,823

(A)

General and administrative expense for the nine months ended September 30, 2011 and the year ended December 31, 2011 include a $2.5 million expense for the
issuance of a fully vested common stock warrant to purchase 250,000 shares of our common stock to a third party for purposes of establishing a charitable foundation following this offering.

(2)

Pro forma basic and diluted net loss per share have been calculated by dividing net loss for the period by the weighted average number of shares of common stock
outstanding during the period, net of weighted-average shares subject to repurchase, giving effect to (a) the assumed conversion of all outstanding shares of our preferred stock into an aggregate of
shares of common stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set
forth on the cover of this prospectus, (b) the conversion of our convertible notes, together with accrued interest thereon, into shares of common
stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, (c) the reclassification of the compound
embedded derivatives liability related to the convertible notes to additional paid-in capital, (d) the reclassification of a portion of Series A and all Series E preferred stock warrant liability to additional paid-in capital, and
(e) the vesting and issuance of shares of common stock to the holders of restricted stock units, each immediately prior to the closing of this offering. See Note 1 to
our consolidated financial statements for more information on our calculation of pro forma net loss per share.

Pro forma reflects (a) the conversion of all outstanding shares of our preferred stock into an aggregate of
shares of common stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set
forth on the cover of this prospectus, (b) the conversion of our convertible notes, together with accrued interest thereon, into shares of common stock, which is based on
an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, (c) the reclassification of the compound
embedded derivatives liability related to the convertible notes to additional paid-in capital, (d) the reclassification of a portion of Series A and all Series E preferred stock warrant liability to additional paid-in capital, and (e) the
vesting and issuance of shares of common stock to the holders of restricted stock units, each immediately prior to the closing of this offering.

(2)

Pro forma as adjusted reflects (a) the pro forma adjustments described above in footnote (1), (b) the reduction of warrant liability as a result of the termination of
certain warrants immediately prior to the effectiveness of this registration statement and (c) the issuance and sale by us of shares of common stock in this offering
and the concurrent private placement at an assumed initial public offering price of $ , the midpoint of the price range set forth on the cover of this prospectus, after deducting
underwriting discounts and commissions and estimated offering expenses. A $1.00 increase (decrease) in the assumed initial public offering price of $ per share would increase
(decrease) the amount of cash, cash equivalents and short-term investments, total assets and total stockholders equity by approximately $ million, assuming the number of
shares offered, as set forth on the cover of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses. Similarly, each increase (decrease) of one million shares in the number of
shares offered would increase (decrease) the amount of cash, cash equivalents and short-term investments, total assets and total stockholders equity by approximately
$ million, assuming that the assumed initial public offering price remains the same and after deducting underwriting discounts and commissions and estimated offering expenses.
The pro forma as adjusted information discussed above is illustrative only and will be adjusted based on the actual public offering price and other terms of this offering determined at pricing.

Other Financial Measures

We believe that our results of operations under generally
accepted accounting principles, or GAAP, when considered in isolation, may only provide limited insight into the performance of our business in any given period. As a result, we manage our business, make planning decisions, evaluate our performance
and allocate resources by assessing non-GAAP measures such as billings, cost of billings, gross profit (loss) on billings, and adjusted EBITDA, in addition to other financial measures presented in accordance with GAAP. We believe that these non-GAAP
measures offer valuable supplemental information regarding the performance of our business, and will help investors better understand the sales volumes, and gross margin and profitability trends, as well as the cash flow characteristics, of our
business. These non-GAAP measures should not be considered in isolation from, are not a substitute for, and do not purport to be an alternative to, revenue, cost of revenue, gross profit (loss), net loss or any other performance measure derived in
accordance with GAAP.

Billings represent amounts
invoiced for products for which ownership, typically evidenced by title and risk of loss, has transferred or services that have been provided to the customer, and for which payment is expected to be made in accordance with normal payment terms.
Billings exclude amounts for undelivered products, services to be performed in the future, and amounts paid or payable to customers. Billings are initially recorded as deferred revenue and are recognized as revenue when all revenue recognition
criteria have been met under our accounting policies as described in Managements Discussion and Analysis of Financial Condition and Results of OperationsCritical Accounting Policies and EstimatesRevenue Recognition. We
reconcile revenue to billings by adding revenue to the change in deferred revenue in a given period.

Cost of billings represents the cost associated with products and services that have
been delivered to the customer, excluding stock-based compensation and amortization of intangibles. Cost of hardware shipments for which revenue is not recognized in the period incurred is recorded as deferred cost of revenue. Deferred cost of
revenue is expensed in the statement of operations as cost of revenue when the corresponding revenue is recognized. Costs related to services are expensed in the period incurred. We reconcile cost of revenue to cost of billings by adding cost of
revenue to the change in deferred cost of revenue, less stock-based compensation and amortization of intangibles included in cost of revenue, in a given period.

Gross profit (loss) on billings is the difference between billings and cost of billings.

Adjusted EBITDA is net loss adjusted for changes in deferred
revenue and deferred cost of revenue, other (income) expense, net, provision for income taxes, depreciation and amortization, stock-based compensation and certain other items management believes affect the comparability of operating results.

The non-GAAP financial measures set forth
below for the years ended December 31, 2009, 2010 and 2011 have been derived from our audited financial statements. The non-GAAP financial measures for the nine months ended September 30, 2011 and 2012 have been derived from our unaudited
consolidated financial statements included elsewhere in this prospectus. Reconciliations to the comparable GAAP measures are contained in the notes below.

Non-GAAP measures
have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. The most significant of these limitations include:



our non-GAAP measures do not reflect the effect of customer acceptance provisions as required under GAAP;



our non-GAAP measures do not reflect the effect of contingent revenue recognition limits due to potential refunds and penalty provisions related to
future delivery or performance as required under GAAP;



our non-GAAP measures are based on contractual invoiced amounts and therefore do not reflect the effect of relative selling price allocations between
separate units of accounting as required under GAAP;



our non-GAAP measures do not reflect the impact of issuing equity-based compensation to our management team and employees or in connection with
acquisitions;



our non-GAAP measures do not reflect the impact of the amortization of acquired intangibles arising from acquisitions;



our non-GAAP measures do not reflect other (income) expense primarily related to gains and losses from the remeasurement of embedded derivative and
preferred stock warrant liabilities, and interest expense from our convertible notes;

although depreciation and amortization are non-cash expenses, the assets being depreciated and amortized may have to be replaced in the future, and
adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditures;

other companies, including companies in our industry, may not use such measures, may calculate non-GAAP measures differently or may use other financial
measures to evaluate their performance, all of which reduce the usefulness of our non-GAAP measures as comparative measures.

Investing in our common stock involves a high degree of
risk. You should consider carefully the risks and uncertainties described below, together with all of the other information in this prospectus, including the consolidated financial statements and the related notes appearing at the end of this
prospectus, before deciding to invest in shares of our common stock. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainty that we are unaware of, or that we currently believe are not material,
also may become important factors that negatively affect us. If any of the following risks actually occurs, our business, financial condition, results of operations and future prospects could be materially and adversely affected. In that event, the
market price of our common stock could decline and you could lose part or even all of your investment.

Risks Related to Our Business and Industry

We have a history of losses and anticipate continued losses and negative operating cash flow for the foreseeable future, and we may not achieve or sustain profitability on a quarterly or annual
basis.

We have incurred significant
losses to date, with an accumulated deficit of $529.4 million as of September 30, 2012. For the years ended December 31, 2009, 2010 and 2011 and the nine months ended September 30, 2012, we incurred net loss of $(113.5) million,
$(148.4) million, $(92.4) million and $(68.7) million, respectively. We expect these losses to continue. We anticipate negative operating cash flow for the foreseeable future, as we expect to incur significant operating expenses in connection with
the continued development and expansion of our business. Our expenses include research and development expenses, general and administrative expenses, selling and marketing expenses and customer service and support expenses relating to prospective
utility customers that may never place any orders and products that may not be introduced or generate revenue until later periods, if at all. There can be no assurance that we will ever achieve or sustain profitability on a quarterly or annual
basis.

Our quarterly results are inherently
unpredictable and subject to substantial fluctuations, and, as a result, we may fail to meet the expectations of securities analysts and investors, which could adversely affect the trading price of our common stock.

Our revenue, billings and other operating results may
vary significantly from quarter to quarter due to a number of factors, many of which are outside of our control. While our revenue and billings have increased in recent periods, there can be no assurances that our revenue and billings will continue
to increase or will not decrease on a quarterly or annual basis. For example, we had lower revenue for the nine months ended September 30, 2012 compared to the nine months ended September 30, 2011 and we anticipate that revenue for the
three months ended December 31, 2012 will also fall below the level reached for the three months ended December 31, 2011. We also expect revenue and billings for the three months ended December 31, 2012 to decline sequentially from the
three months ended September 30, 2012. In particular, the fourth quarter revenue decline may be substantial compared to each of the preceding quarters since the beginning of 2011 and may lead to a gross loss for the period. In addition, gross
margin on billings for the three months ended September 30, 2012 declined sequentially and period over period, and we anticipate gross margin on billings will decline period over period for the three months ended December 31, 2012. We also
expect adjusted EBITDA could be negative in future periods. See Managements Discussion and Analysis of Financial Condition and Results of Operations.

The factors that may affect the unpredictability of our
quarterly results and cause our stock price to fluctuate include, but are not limited to:

failures of our products, components that we use in our products or third-party devices containing our products that delay deployments, harm our
reputation or result in high warranty costs, contractual penalties or terminations;



product or project failures by third-party vendors, utility customers or competitors that result in the cancellation, slowing down or deferring of
projects;



liquidated damages provisions in our contracts, which could result in significant financial penalties if triggered or, even if not triggered, could
affect our ability to recognize revenue in a given period;



the ability of our suppliers and manufacturers to deliver supplies and products to us on a timely basis;



delays associated with government funding programs for smart grid projects;



political and consumer sentiment and the related impact on the scope and timing of smart grid deployment; and



economic, regulatory and political conditions in the markets where we operate or anticipate operating.

As a result, we believe that quarter to quarter comparisons
of operating results are not necessarily a good indication of what our future performance will be. It is likely that in some future quarters, our operating results may be below the expectations of securities analysts or investors, in which case the
price of our common stock may decline.

Sales cycles to
utility customers can be lengthy and unpredictable and require significant employee time and financial resources with no assurances that a prospective customer will select our products and services.

Sales cycles with utilities, our potential customers, tend
to be long and unpredictable. Utilities generally have extensive budgeting, procurement, competitive bidding, technical and performance review, and regulatory approval processes that can take up to several years to complete. Utilities may choose,
and many historically have often chosen, to follow industry trends rather than be early adopters of new products or services, which can extend the lead time for or prevent acceptance of more recently introduced products or services such as ours. In
addition, in many instances, a utility may require one or more pilot programs to test our new products and services before committing to a larger deployment. These pilot programs may be quite lengthy and further delay the sales cycle with no
assurance that they will lead to a larger deployment or future sales. Furthermore, to the extent our products are required to be deployed with the products of others, such as meters, delays related to such third-party products will further lengthen
the sales cycle.

This extended sales process
requires us to dedicate significant time by our senior management, and sales and marketing and customer services personnel, and to use significant financial resources without any assurance of success or recovery of our related expenses. Similarly,
we are likely to incur these significant operating expenses well ahead of recognizing the related revenue because our ability to recognize revenue is typically dependent on meeting contractual customer acceptance and other requirements.

The lengthy sales cycles of our products and services also
make it difficult to forecast new customer deployments, as well as the volume and timing of orders, which, in turn makes forecasting our future results of operations challenging. In the event that we publicly disclose any forecasts of our future
results of operations or other performance metrics and those forecasts ultimately turn out to be inaccurate, the value of our common stock could significantly decline.

In addition, we have an agreement with one of our primary
contract manufacturers, which provides for tiered volume-based pricing. To the extent our volumes decrease below specific thresholds, our gross profit and

gross margins will be negatively impacted, which has occurred previously. Alternatively, in order to take advantage of the tiered volume-based pricing in any one quarter, we may purchase, and
have previously purchased, additional inventory exposing us to the risk that we may incur costs for excess and obsolete inventory.

Our revenue is not predictable and recognition of a significant portion of it will be deferred into future periods.

Once a utility decides to move forward with a
large-scale deployment of our products and services, the timing of and our ability to recognize related revenue will depend on several factors, some of which may not be under our control. These factors include shipment schedules that may be delayed
or subject to modification, the rate at which our utility customers choose to deploy our Smart Energy Platform, customer acceptance of all or any part of our products and services, our contractual commitments to provide new or enhanced
functionality at some point in the future, other contractual provisions such as liquidated damages, our manufacturers ability to provide an adequate supply of components, the requirement to obtain regulatory approval, and our ability to
deliver quality products according to expected schedules. In light of these factors, the application of complex revenue recognition rules to our products and services has required us to defer, and in the future will likely continue to require us to
defer, a significant amount of revenue until undetermined future periods. As of September 30, 2012, we had $472.6 million in deferred revenue. It may be difficult to predict the amount of revenue that we will recognize in any given period and
amounts recognized may fluctuate significantly from one period to the next.

Amounts included in our total backlog and order backlog may not result in actual billings or revenue or translate into profits.

Our total backlog represents future product and service billings that we expect to generate pursuant to
contracts that we have entered into with our utility customers and meter manufacturers. Our total backlog includes our order backlog, which represents future billings for open purchase orders and other firm commitments. We anticipate that our total
backlog and order backlog will fluctuate from period to period throughout 2012 and beyond.

We cannot guarantee that our total backlog or order backlog will result in actual billings in the originally anticipated period or at all. In addition, the contracts reflected in our total backlog and
order backlog may not generate margins equal to or better than our historical operating results. We only recently began to track total backlog and order backlog on a consistent basis as performance measures and as a result, we do not have
significant experience in determining the level of realization that we will actually achieve on our total backlog and order backlog. Our customer contracts are typically structured as master purchase and service agreements, or MSAs, under which the
customer may place purchase orders over the course of a deployment. These deployments can extend for a number of years. Because our MSAs do not typically require a customer or meter partner to purchase a minimum amount of product or services, total
backlog is an estimate based upon contractual terms, existing purchase orders and other available information regarding the amount and timing of expected future purchase orders to be placed by our utility customers and meter manufacturers, including
non-binding forecasts. No assurance can be made that firm purchase orders will be placed under these MSAs in the amounts we estimate, within the time period we expect, or at all. Total backlog is subject to adjustments due to the long-term nature of
our customer deployments. Adjustments can result from a variety of factors, including changes in the nature or scope of customer deployments, the impact of contingency provisions related to future delivery or performance, customer cancellations,
market conditions, delayed regulatory approvals and customer defaults. Delays due to external market factors or delays in deployments and required regulatory approvals have in the past and may in the future cause us to extend the deployment schedule
or make modifications under customer contracts. In addition, under our MSAs, our utility customers generally have the right to terminate the MSA for any reason, including for their sole convenience, a material breach or insolvency on our part or
their inability to obtain required regulatory approval. The occurrence of such adjustments or terminations could materially reduce the amount of, or delay the fulfillment of, our total and order backlog. If our total backlog or order backlog fails
to materialize as expected, we could experience a material reduction in future billings, revenue, operating results or cash flow.

We are dependent on the utility industry, which has experienced volatility in capital spending. This
volatility could cause our results of operations to vary significantly from period to period.

Similar to other industries, the utility industry has been affected by recent economic factors, including continued global economic
uncertainty, concerns over the downgrade of U.S. sovereign debt and continued sovereign debt, monetary and financial uncertainties in European and other foreign countries. We derive substantially all of our revenue from sales of products and
services directly and indirectly to utilities. Purchases of our products and services may be reduced or deferred as a result of many factors including economic downturns and uncertainty, slowdowns in new residential and commercial construction, a
utilitys access to capital on acceptable terms, the timing and availability of government grants or incentives, utility specific financial circumstances, mergers and acquisitions, regulatory decisions, weather conditions, consumer opposition
and fluctuating interest rates. Even with economic recovery, it may take time for our utility customers to establish new budgets and return to normal purchasing patterns. We cannot predict the reoccurrence of any economic slowdown or the strength or
sustainability of the economic recovery, worldwide, in the United States or in our industry. We have experienced, and may in the future experience, variability in operating results on an annual and a quarterly basis as a result of these factors.
Because a significant portion of our expenses is fixed in the short term or is incurred in advance of anticipated sales, we may not be able to decrease our expenses in a timely manner to offset any shortfall of sales. This could materially and
adversely affect our operating results, financial condition and cash flows.

Substantially all of our current products depend on the availability and are subject to the regulation of radio spectrum in the United States and abroad.

Substantially all of our current hardware products are
designed to communicate wirelessly via radio frequencies and therefore depend on the availability of adequate radio spectrum in order to operate. While these products could be designed to operate in a variety of different frequencies or by using
other technologies such as cellular, in the United States they are primarily designed to form a wireless RF mesh using the unlicensed 902-928 megahertz, or MHz, band. The 902-928 MHz band is available for a wide variety of uses and requires us to
manage interference by other users who operate in accordance with the Federal Communications Commission, or FCC, rules. The unlicensed frequencies are also often the subject of proposals to the FCC requesting a change in the rules under which such
frequencies may be used. In the past, the FCC has re-allocated spectrum for new or additional uses, and has adopted changes to the requirements for equipment using radio spectrum. It is possible that the FCC or the U.S. Congress could adopt
additional changes, which may be incompatible with our current or future product offerings, as well as products currently installed in the field, or require them to be modified at significant, or even prohibitive, cost. If the unlicensed frequencies
become unacceptably crowded, restrictive or subject to changed laws, regulations or rules governing their use, our business, financial condition and results of operations could be materially and adversely affected.

Our international growth and future success also depend on
the availability of radio spectrum that is compatible with our products or on our ability to develop products that use alternative communications technology, such as Gen4, our next-generation networking technology, which is available to utility
customers in some products today, with more products coming later this year and next year, and will support cellular communications. In Australia, we primarily use unlicensed spectrum in the 915-928 MHz band with relatively minimal modifications
needed to our products. In many other countries, however, there may not be spectrum available or we may be required to obtain a license to operate in any frequency band that is compatible with our products, including, but not limited to, the 902-928
MHz band. Licenses to appropriate spectrum in these countries may be unavailable or only available at unreasonably high prices. Similarly, in the event that we were only able to obtain a license outside of the 902-928 MHz band, the cost of modifying
or redesigning our products to make them compatible with available spectrum could be significant or even cost-prohibitive. Alternatively, if we are not able to obtain available spectrum on financially advantageous terms, we may not be able to
compete without investing in alternative communication technology. If limitations on the availability of spectrum or the cost of making necessary modifications or investments in new technology preclude us from selling our products in markets outside
of the United States, our growth, prospects, financial condition and results of operations could be materially and adversely affected.

A limited number of our utility customers are responsible for a significant portion of our billings,
revenue and cash flow. A decrease in sales to these utility customers could have a material adverse effect on our operating results and financial condition.

A substantial majority of our revenue, billings and cash
flow depends on relatively large sales to a limited number of utility customers. The combination of lengthy sales cycles and relatively large sales to a small number of utility customers increases the risk of quarterly fluctuations in our billings,
revenue and operating results. Please see Managements Discussion and Analysis of Financial Condition and Results of OperationsKey Elements of Operating and Financial Performance for further information regarding customer
concentration. Our master purchase and service agreements, or MSAs, do not impose purchase obligations on our utility customers until we have received a purchase order or agreed to a statement of work. Further, the MSAs are typically subject to
termination for any reason, including for convenience following a specified notice period. We expect that a limited number of utility customers will continue to account for a substantial portion of our revenue in future periods. Changes in the
business requirements, vendor selection, or purchasing behavior of our utility customers could significantly decrease our sales. In addition, our MSAs are complex, often requiring close coordination with our customers over extended preparation and
deployment periods and involving large-scale delivery of our products and services. From time to time we have experienced and may in the future experience challenges in satisfying our customers throughout these preparation and deployment
periods regarding all aspects of our performance. Additionally, we have, in the past, received correspondence from customers claiming that there have been deficiencies in our timeliness and coordination regarding hardware, software and services for
deployment, and requesting that we remedy the deficiencies noted. If we are unable to address customers concerns, we could be required to pay penalties, liquidated damages or other expenses, the customer could terminate our MSA and our
reputation could be damaged. Any of these factors could materially and adversely affect our business, financial condition, and results of operations.

Our marketing efforts depend significantly on our ability to
call on our current utility customers to provide positive references to new, potential utility customers. Given our limited number of utility customers, the loss or dissatisfaction of any customer could substantially harm our brand and reputation,
inhibit the market acceptance of our products and services, and impair our ability to attract new utility customers and maintain existing utility customers. Any of these consequences could have a material adverse effect on our business, financial
condition and results of operations.

The market for our
products and services, and smart grid technology generally, is still developing. If the market develops less extensively or more slowly than we expect, our business could be harmed.

The market for our products and services, and smart grid technology generally, is still developing, and it is
uncertain whether our products and services will achieve and sustain high levels of demand and market acceptance. Our near-term and long-term success will depend to a substantial extent on the willingness and ability of utilities to implement smart
grid technology. Many utilities lack the financial resources and/or technical expertise required to evaluate, deploy and operate smart grid technology. Utilities activities are governed by regulatory agencies, including public utility
commissions, which may not create a regulatory environment that is conducive to the implementation of smart grid technologies in a particular jurisdiction. Furthermore, some utilities may be reluctant or unwilling to adopt smart grid technology
because they do not perceive the benefits or are unable to develop a business case to justify the up-front and ongoing expenditures. If utilities do not implement smart grid technology or do so in fewer numbers or more slowly than we expect, our
business and operating results would be adversely affected. For example, in 2010, the rate of smart grid adoption slowed due to uncertainty surrounding the timing and tax treatment of U.S. government stimulus funding, negative publicity and consumer
opposition, and regulatory investigations. These uncertainties caused many potential utility customers that had been considering smart grid programs in the United States to further evaluate their smart grid

initiatives and delay their procurement processes or extend their deployment schedules. Smart grid adoption in international markets has trailed adoption in the United States as international
markets continue to explore the technology and define the benefits and regulatory requirements for the smart grid.

Similarly, our success depends on our ability to expand beyond advanced metering sales and sell additional products and services, such as
distribution automation and demand-side management solutions, to our existing utility customers. There can be no assurance that these products and services will be accepted by utilities or consumers. Other competing products and services may emerge
and may be more successful.

Adverse publicity about, or
consumer or political opposition to, the smart grid could inhibit the growth of the overall market.

The safety and security of the power grid, the accuracy and protection of the data collected by meters and transmitted via the smart grid,
and concerns about the safety and perceived health risks of using radio frequency communications have been the focus of recent adverse publicity. For example, in Northern California, PG&Es full-scale deployment of our networking platform
and advanced metering solution has been subject to continued scrutiny following allegations of inaccurate bills generated by newly-installed smart meters and safety concerns about the levels of radio frequency electromagnetic fields
emitted by the wireless communications technology used by the meters. As a result, the California State Senate created a special committee and the California Public Utilities Commission, or CPUC, hired an independent investigator to review the
installation and use of advanced metering products. Negative publicity and consumer opposition in California, Maine and elsewhere has caused other utilities or their regulators to respond by delaying or modifying planned smart grid initiatives,
mandating that utilities allow their customers to opt out of smart metering programs, or calling for investigations and/or implementation of unfavorable regulations and legislation. For example, in January 2012, the CPUC ruled that PG&E must let
its customers retain or receive an analog meter, for nominal initial and monthly fees, if they, for any reason, opt out of PG&Es deployment of PG&Es smart meters. Similarly, outside the United States, public concern over smart
grid projects in places such as Victoria, Australia has resulted in increased government scrutiny. Additionally, testing commissioned by the CPUC and other organizations could, in the future, contain negative information regarding the accuracy and
safety of smart grid solutions. Finally, smart grid projects by other companies may be, or could be viewed by the public as, unsuccessful. Any of the foregoing factors could directly impact our current or future deployments, as well as inhibit the
growth of the overall smart grid market, either of which could cause our business to suffer.

Security breaches involving our smart grid products or services, publicized breaches in smart grid products and services offered by others, or the public perception of security risks or
vulnerability created by the deployment of the smart grid in general, whether or not valid, could harm our business.

The security technologies we have integrated into our networking platform and solutions that are designed to detect unauthorized activity
and prevent or minimize security breaches may not function as expected and there can be no assurance that our products and services, those of other companies with whose products our products and services are integrated or interact, or even the
products of other smart grid solutions providers will not be subject to significant real or perceived security breaches.

Our networking platform allows utilities to collect, monitor, store, compile and analyze sensitive information related to consumers
energy usage, as well as the performance of different parts of the power grid. As part of our data transfer and managed services and SaaS, we may store and/or come into contact with sensitive consumer information and data when we perform
operational, installation or maintenance functions for our utility customers. If, in handling this information, we, our partners or our utility customers fail to comply with privacy or security laws, we could face significant legal and financial
exposure to claims of government agencies, utility customers and consumers whose privacy is compromised. Even the perception that we, our partners or our utility customers have improperly handled sensitive, confidential information could have a
negative effect on our business. In addition, third parties may attempt to breach our security measures or inappropriately use or access our network services or the network hardware and software we have in the field through computer viruses,
physical or electronic break-ins, and other means. If a breach is

successful, sensitive information may be improperly obtained, manipulated or corrupted, and we may face legal and financial exposure. In addition, a breach could lead to a loss of confidence in
our products and services and our business could suffer.

Our current and anticipated future products and services allow authorized personnel to remotely control equipment at residential and commercial locations, as well as at various points on the power grid.
For example, our software allows a utility to remotely connect and disconnect electricity at specific customer locations. If an unauthorized third party were to breach our security measures and disrupt, gain access to or take control of any of our
products or services, our business and reputation could be severely harmed.

Our products and services may also be integrated or interface with products and services sold by third parties, and rely on the security of those products and their secure transmission of proprietary data
over the Internet and cellular networks. Because we do not have control over the security measures implemented by third parties in their products or in the transmission of data over the Internet and cellular networks, we cannot ensure the complete
integrity or security of such third-party products and transmissions.

Concerns about security or customer privacy may result in the adoption of state or federal legislation that restricts the implementation of smart grid technology or requires us to make modifications to
our products, which could significantly limit the deployment of our technologies or result in significant expense to modify our products.

Any real or perceived security breach could seriously harm our reputation and result in significant legal and financial exposure,
including increased remediation costs and security protection costs, inhibit market acceptance of our products and services, halt or delay the deployment by utilities of our products and services, cause us to lose customers, harm our reputation,
trigger unfavorable legislation and regulatory action, and inhibit the growth of the overall market for smart grid products and services. Any of these risks could have a material adverse effect on our business, financial condition and results of
operations.

If our products contain defects or otherwise
fail to perform as expected, we could be liable for damages and incur unanticipated warranty, recall and other related expenses, our reputation could be damaged, we could lose market share and, as a result, our financial condition or results of
operations could suffer.

Our products
are complex and may contain defects or experience failures due to any number of issues in design, materials, deployment and/or use. If any of our products contain a defect, compatibility or interoperability issue or other error, we may have to
devote significant time and resources to find and correct the issue. Such efforts could divert the attention of our management team and other relevant personnel from other important tasks. A product recall or a significant number of product returns
could: be expensive; damage our reputation and relationships with utilities, meter vendors and other third-party vendors; result in the loss of business to competitors; and result in litigation against us. Costs associated with field replacement
labor, hardware replacement, re-integration with third-party products, handling charges, correcting defects, errors and bugs, or other issues could be significant and could materially harm our financial results. For example, in March 2010, we
discovered that a faulty capacitor from a third-party supplier was used in a discrete number of our communications modules. We recorded costs associated with this faulty capacitor of $6.3 million for the year ended December 31, 2009, which
represented the write-off of deferred costs associated with returned products of $2.4 million and $3.9 million related to estimated future product warranty claims. In the first quarter of 2010, we recorded product warranty costs associated with this
faulty capacitor of $12.5 million, which represented $8.2 million in costs associated with returned product and $4.3 million related to the estimated future product warranty claims. In addition, due to a product repair program we implemented for one
of our customers, in the second quarter of 2011, we recorded a $2.5 million charge against billings for estimated amounts payable to a customer in connection with the product repair program and a $1.0 million increase to cost of product revenue and
warranty liability.

Estimated future product
warranty claims are based on the expected number of field failures over the warranty commitment period, the term of the product warranty period, and the costs for repair, replacement and

other associated costs. Our warranty obligations are affected by product failure rates, claims levels, material usage and product re-integration and handling costs. Because our products are
relatively new and we do not yet have the benefit of long-term experience observing products performance in the field, our estimates of a products lifespan and incidence of claims may be inaccurate. Should actual product failure rates,
claims levels, material usage, product re-integration and handling costs, defects, errors, bugs or other issues differ from the original estimates, we could end up incurring materially higher warranty or recall expenses than we anticipate.

Our utility customer contracts typically contain provisions
that could cause us to incur penalties, be liable for damages, and/or incur unanticipated expenses with respect to the functionality, deployment, operation and availability of our products and services, and that provide the customer with the right
to terminate the contract for any reason.

In addition to the risk of unanticipated warranty or recall expenses, our utility customer contracts typically contain provisions that
could cause us to incur penalties, be liable for damages, including liquidated damages, or incur other expenses, if we experience difficulties with respect to the functionality, deployment, operation and availability of our products and
services. In the event of late deliveries, late or improper installations or operations, failure to meet product or performance specifications or other product defects, interruptions or delays in our managed service offerings, our customer
contracts may expose us to penalties, significant damages and other liabilities. For example, we have in the past agreed to reimburse utility customers for their costs and incurred liquidated damages by failing to timely meet contractual
milestones or other contractual requirements. In addition, our utility customer contracts are typically subject to termination for any reason, including for convenience following a specified notice period, our material breach or insolvency, or the
failure to obtain required regulatory approval. If a customer terminates its customer contract for any reason, our estimates of total backlog and order backlog discussed under BusinessTotal Backlog will be reduced. Reductions in
total backlog and order backlog may have a negative effect on future revenue, billings, profitability and liquidity. In the event we were to incur contractual penalties, such as liquidated damages or other related costs that exceed our expectations,
or our utility customers terminate their contracts with us, our business, financial condition and operating results could be materially and adversely affected.

Our success depends in part on our ability to integrate our technology into meters and our relationship with meter manufacturers.

Our business depends on our ability to
integrate our communications modules with electricity meters that are manufactured by third parties such as General Electric Company, Landis+Gyr AG, which was acquired by Toshiba Corporation, and Secure Meters Limited. In a typical smart grid
deployment, our utility customer purchases our communications modules from one or more meter manufacturers after it is integrated into the meters. Accordingly, even if demand for our products is strong, we have in the past and may in the future be
constrained by the production capacity and priorities of the meter manufacturers. In addition, several of these meter manufacturers offer competing smart grid products, partner with other smart grid providers or may otherwise choose not to integrate
our communications modules with their meters. If for technical or any other reason we were to lose the ability to integrate our communications modules with meters manufactured by third parties, or if our relationships with meter manufacturers were
to be terminated or renegotiated on unfavorable terms, our business, financial condition, and operating results could suffer. Further, there have been instances where meters with which our technology had been integrated experienced defects or had
other problems that were unrelated to our technology. If this occurs in the future and the defects or problems are more significant or occur more frequently, our reputation could suffer and our business could be harmed.

From time to time, we have worked and expect to continue to work with
third parties to pursue smart grid market opportunities. If we were unable to establish and maintain these relationships, or if our initiatives with these third parties are unsuccessful, our business may suffer.

For some of our existing and anticipated future products and
services, we expect to maintain and may seek to establish relationships with third parties in order to take advantage of smart grid market opportunities. For

example, we have designed our products to interface with electric vehicle charging stations, in-home devices and data analytics products, and will need to work with third parties to successfully
deploy these products. Before a utility is willing to move forward with a deployment of our products, they may require that we partner with third-party vendors and/or obtain a certification from these vendors that our products will function as
intended when integrated with their products. In addition, third-party vendors may offer competing products, partner with other networking providers or otherwise choose not to partner with us. In the event that we are unable to establish or maintain
new relationships on favorable terms, or at all, our ability to successfully sell our existing and anticipated future products and services could be jeopardized.

There are no assurances we will be able to formalize any joint
development activities with EMC.

In
December 2011, we and EMC Corporation, or EMC, entered into a memorandum of understanding to deliver a smart grid analytics solution. We have not finalized any agreement with EMC for such arrangement, and there are no assurances that we will ever be
able to do so on terms favorable to us, if at all. If we do finalize an agreement with EMC, there can be no assurance that joint activities with EMC will be successfully deployed.

We may not be able to identify adequate strategic relationship opportunities, or form strategic relationships, in the
future.

Strategic business
relationships may be an important factor in the growth and success of our business. For example, we entered into memorandums of understanding with EMC and Hitachi and following negotiation, entered into a master collaboration agreement with Hitachi
based on such memorandum of understanding. However, there are no assurances that we will be able to identify or secure suitable business relationship opportunities in the future and our competitors may capitalize on such opportunities before we do.
Concurrently with the execution of the memorandums of understanding, EMC and Hitachi made significant investments in us pursuant to convertible notes that will convert into shares of our common stock immediately prior to the closing of this
offering. We may not be able to offer similar benefits to other companies which could impair our ability to establish such relationships. Moreover, identifying such opportunities could demand substantial management time and resources and involves
significant costs and uncertainties. If we are unable to successfully source and execute on strategic relationship opportunities in the future, our business and results of operations could be significantly harmed.

Our technology, products and services have only been developed in the
last several years and we have had only limited opportunities to deploy and assess their performance in the field at full scale.

The current generation of our networking platform and solutions has only been developed in the last several years and is continuing to
evolve. Deploying and operating our technology is a complex endeavor and, until recently, had been done primarily in small pilot programs. As the size, complexity and scope of our deployments have expanded, we have been able to test product
performance at a greater scale and in a variety of new geographic settings and environmental conditions. These larger deployments have presented a number of unforeseen operational and technical challenges, which in some cases have caused delays and
required us to commit significant resources to address these challenges. As the number, size and complexity of our deployments grow, we may continue to encounter unforeseen operational, technical and other challenges, some of which could cause
significant delays, trigger contractual penalties, result in unanticipated expenses, and/or damage to our reputation, each of which could materially and adversely affect our business, financial condition and results of operations.

If we fail to respond to evolving technological changes, our products
and services could become obsolete or less competitive.

Our industry is highly competitive and characterized by new and rapidly evolving technologies, standards, regulations, customer requirements, and frequent product introductions. Accordingly, our operating
results depend upon, among other things, our ability to develop and introduce new products and services, as well as our

ability to reduce production costs of our existing products. For example, in January 2012, we announced Gen4, our next-generation networking technology, which is available in some products today,
with more products coming later this year and next year. The process of developing new technologies and products is complex, and if we are unable to develop enhancements to, and new features for, our existing products or acceptable new products that
keep pace with technological developments or industry standards, our products may become obsolete, less marketable and less competitive and our business could be significantly harmed.

We depend on our ability to develop new products and to enhance and sustain the quality of existing products.

Most of our current billings and revenue
are derived from our networking platform and advanced metering solution, but our growth and future success will depend, in part, on our ability to continue to design and manufacture new competitive products and to enhance and sustain the quality and
marketability of our existing products. As such, we have made, and expect to continue to make, substantial investments in technology development. For example, in January 2012, we announced Gen4, our next-generation networking technology, which is
available in some products today, with more products coming later this year and next year. In the future, we may not have the necessary capital, or access to capital on acceptable terms, to fund necessary levels of research and development. Even
with adequate capital resources, we may nonetheless experience unforeseen problems in the development or performance of our technologies or products. The market for smart grid technology products is still in its early stages, and we cannot assure
you that we will be successful in developing or selling new products in this market. In addition, we may not meet our product development schedules and, even if we do, we may not develop new products fast enough to provide sufficient differentiation
from our competitors products, which may be more successful.

We and our utility customers operate in a highly regulated business environment and changes in regulation could impose costs on us or make our
products less economical.

Our products
and our utility customers are subject to federal, state, local and foreign laws and regulations. Laws and regulations applicable to us and our products govern, among other things, the manner in which our products communicate, and the environmental
impact and electrical reliability of our products. Additionally, our utility customers are often regulated by national, state and/or local bodies, including public utility commissions, the Department of Energy, the Federal Energy Regulatory
Commission and other bodies. Prospective utility customers may be required to gain approval from any or all of these organizations prior to implementing our products and services, including specific permissions related to the cost recovery of these
systems. Regulatory agencies may impose special requirements for implementation and operation of our products. We may incur material costs or liabilities in complying with government regulations applicable to us or our utility customers. In
addition, potentially significant expenditures could be required in order to comply with evolving regulations and requirements that may be adopted or imposed on us or our utility customers in the future. Such costs could make our products less
economical and could impact our utility customers willingness to adopt our products, which could materially and adversely affect our revenue, results of operations and financial condition.

Furthermore, changes in the underlying regulatory
conditions that affect utilities could have a potentially adverse effect on a utilitys interest or ability to implement smart grid technologies. Many regulatory jurisdictions have implemented rules that provide financial incentives for the
implementation of energy efficiency and demand response technologies, often by providing rebates or through the restructuring of utility rates. If these programs were to cease, or if they were restructured in a manner inconsistent with the
capabilities enabled by our products and services, our business, financial condition and results of operations could be significantly harmed.

The adoption of industry standards applicable to our products or services could limit our ability to compete in the marketplace.

Standards bodies, which are formal and informal associations
that seek to establish voluntary, non-governmental product and technology standards, are influential in the United States and abroad. We

participate in voluntary standards organizations in order to both help promote non-proprietary, open standards for interoperability with our products and prevent the adoption of exclusionary
standards. However, we are not able to control the content of adopted voluntary standards and do not have the resources to participate in all voluntary standards processes that may affect our markets. Some of the standards bodies and alliances in
which we participate may require that we license to other participants certain of our patent claims that are necessary or essential to practice a particular standard, including competitors, who elect to produce products compliant with that standard.
These obligations to license our necessary patent claims may allow our competitors to use our patents to develop and sell products that compete with our products without spending the time and expense that we incurred to develop the technology
covered by the patents, thereby potentially reducing any time to market advantage we might have as a result of these patents. These obligations could also substantially restrict and may eliminate our ability to use our patents as a barrier to entry
or as a significant source of revenue. Moreover, because the specifications for these industry standards are generally available to members of the applicable standards bodies and alliances for little or no cost, competitors might be able to more
easily create products that compete with our products.

The adoption, or expected adoption, of voluntary standards that are incompatible with our products or technology or that favor our competitors products or technology could limit the market
opportunity for our products and services or render them obsolete, any of which could materially and adversely affect our revenue, results of operations, and financial condition.

Some of our customers and potential customers have applied for
government grants and may also seek to participate in other government incentive programs, and if those grants or other incentives are not received or are significantly delayed, our results of operations could suffer.

Many utilities, including some of our customers and
potential customers, apply for grants and may seek to participate in other government incentive programs, designed to stimulate the economy and support environmental initiatives, including smart grid technologies. In certain cases, such as with the
American Reinvestment and Recovery Act of 2009, or ARRA, the funds have been approved by the U.S. government, and agreements have been established between the government and the utilities, but portions of the funds have not yet been distributed. A
significant number of our utility customers have applied for and been granted funding under ARRA programs, representing a significant portion of our current and future revenue and billings. Our customers and potential customers who have been awarded
these government grants or incentives may delay or condition the purchase of our products and services upon receipt of such funds or upon their confidence in the future disbursement of those funds. If our customers and potential customers do not
receive these funds or if receipt is significantly delayed, our results of operations could suffer. Similarly, the receipt of government funds or incentives may be conditioned upon utilities meeting milestones and other requirements, some of which
may not be known until a future point in time. In addition, if our products and services do not meet the requirements necessary for receipt of government funds or other incentives, or if third parties fail to meet their obligations, our customers
and potential customers may delay or condition the purchase of our products and services until they meet these requirements and our results of operations could suffer. Furthermore, there can be no assurance of government funds or incentives for
utilities in future periods, either in the United States or in other countries where we may pursue business. As a result, our customers and potential customers may not have the resources or incentives to purchase our products and services.

If our products do not interoperate with our utility
customers other systems, the purchase or deployment of our products and services may be delayed or cancelled.

Our products are designed to interface with our utility customers back office billing and other systems, each of which may have
different specifications and utilize multiple protocol standards and products from other vendors. Our products will be required to interoperate with many or all of these products as well as future products in order to meet our utility
customers requirements. If we find errors in the existing software or defects in the hardware used in our utility customers systems, we may need to modify our products or services to fix or

overcome these errors so that our products will interoperate with the existing software and hardware, which could be costly and negatively affect our business, financial condition, and results of
operations. In addition, if our products and services do not interoperate with our utility customers systems, utility customers may seek to hold us liable, demand for our products could be adversely affected or orders for our products could be
delayed or cancelled. This could hurt our operating results, damage our reputation, and seriously harm our business and prospects.

Interruptions or delays in service from our third-party data center facilities, or problems with the third-party hardware or software that we
employ, could impair the delivery of our service and harm our business.

We currently offer managed services and SaaS, including disaster recovery services, utilizing two data center facilities operated by separate third parties in California and Nevada. These
facilities may be vulnerable to damage or interruption from, among other things, fire, natural disaster, power loss, telecommunications failure, war, acts of terrorism, unauthorized entry, human error, and computer viruses or other defects. They may
also be subject to break-ins, sabotage, intentional acts of vandalism and similar misconduct. We rely on software and hardware technology provided by third parties to enable us to provide these services. Any damage to, or failure of, these
third-party data centers or the third-party hardware and software we employ, could result in significant and lengthy interruptions in the services we provide to our utility customers. Such interruptions could reduce our revenue and billings, cause
us to issue credits or pay penalties, cause customers to terminate their service, harm our reputation and adversely affect our ability to attract new utility customers.

We do not control certain critical aspects of the manufacture of our
products and depend on a limited number of contract manufacturers.

Our future success will depend significantly on our ability to manufacture our products timely and cost-effectively, in sufficient volumes, and in accordance with quality standards. Our primary
manufacturing relationships are with Jabil Circuit, Inc. and Plexus Corp. Our contract manufacturers provide us with a wide range of operational and manufacturing services, including material procurement, final assembly, test quality control,
warranty repair, and shipment to our utility customers and third-party vendors.

Our reliance on our contract manufacturers reduces our control over the manufacturing process, exposing us to risks, including reduced control over quality assurance, product costs and product supply. Any
manufacturing disruption by our contract manufacturers could impair our ability to fulfill orders. We may be unable to manage our relationships with contract manufacturers effectively as they may experience delays, disruptions, capacity constraints
or quality control problems in their manufacturing operations or otherwise fail to meet our future requirements for timely delivery. Similarly, to the extent that our contract manufacturers procure materials on our behalf, we may not benefit from
any warranties received by the contract manufacturers from the suppliers or otherwise have recourse against the original supplier of the materials or even the contract manufacturer. In such circumstances, if the original supplier were to provide us
or our contract manufacturers with faulty materials, we might not be able to recover the costs of such materials or be compensated for any damages that arise as a result of the inclusion of the faulty components in our products. For example, in
March 2010, we discovered that a faulty capacitor from a third-party supplier was used in a discrete number of our communications modules.

One or more of our contract manufacturers may suffer an interruption in its business, or experience delays, disruptions or quality control
problems in its manufacturing operations, or seek to terminate its relationship with us, or we may choose to change or add additional contract manufacturers for other reasons. Additionally, we do not have long-term supply agreements with our
contract manufacturers. As a result, we may be unable to renew or extend our agreement on terms favorable to us, if at all. Although the contract manufacturing services required to manufacture and assemble our products may be readily available from
a number of established manufacturers, it is risky, time consuming and costly to qualify and implement contract manufacturer relationships.

Any of these risks could have a material adverse effect on our business, financial condition and results of operations.

We depend on a limited number of key suppliers and if such suppliers fail to provide us with
sufficient quantities of components at acceptable levels of quality and at anticipated costs, our revenue and operating results could be materially and adversely affected.

Several of the components used in our products come from
sole, limited source or geographically concentrated suppliers, such as Analog Devices and Renesas Electronics America Inc. Additionally, our suppliers are not typically contractually obligated to supply us with components in minimum quantities or at
predetermined prices over the long term. Accordingly, we may be vulnerable to price increases, component quality issues, financial, natural disasters, or other difficulties faced by our suppliers, causing shortages or interruptions in supply of
components and materials, including components that have been or will be discontinued, which could cause us to delay shipments to our utility customers. For example, some of our key suppliers are located in Japan and their ability to timely provide
us with the necessary components used in our products was compromised as a result of the catastrophic earthquake and tsunami in March 2011. To help address these issues, we may purchase quantities of these items that are in excess of our estimated
requirements. As a result, we could be forced to record excess and obsolete inventory charges to provide for these excess quantities and we may also be subject to pricing risk or carrying charges, which could harm our operating results.

If we experience any shortages due to reliance on a limited
number of suppliers, commodity supply constraints, capacity constraints, natural disasters or price fluctuations related to the raw materials used, or if we are not able to procure components from alternate sources at acceptable prices and within a
reasonable period of time, our reputation could suffer and our business, financial condition and results of operations could be materially and adversely effected. In addition, we may also be subject to contractual penalties if we fail to deliver our
products and services on time.

Further, our
utility customers may reschedule or cancel orders on relatively short notice. If our utility customers cancel orders after we have ordered the corresponding product from our suppliers, we may be forced to incur cancellation fees or to purchase
products that we may not be able to resell, which could have a material adverse effect on our business, financial condition and results of operations.

Our business could be severely harmed by natural disasters or other catastrophes.

A significant catastrophic event such as war, acts of terrorism, natural disasters, such as earthquakes, or
global threats, including, but not limited to, the outbreak of epidemic disease, could disrupt our operations and impair deployment of our Smart Energy Platform by our utility customers, interrupt critical functions, cause our suppliers to be
unable to meet our demand for parts and equipment, reduce demand for our products, prevent our utility customers from honoring their contractual obligations to us or otherwise affect our business negatively. To the extent that such disruptions or
uncertainties result in delays or cancellations of customer orders or the deployment of our products, or the manufacture or shipment of our products, our business, operating results and financial condition could be materially and adversely affected.

We operate in a highly competitive industry and we compete
against many companies with substantially greater financial and other resources, and our market share and results of operations may be reduced if we are unable to respond to our competitors effectively.

Competition in our market is intense and involves rapidly
changing technologies, evolving industry standards, frequent new product introductions, and changes in customer requirements. To maintain and improve our competitive position, we must keep pace with the evolving needs of our utility customers and
continue to develop and introduce new products, features and services in a timely and efficient manner. Our competitors range from small companies to very large and established companies. These competitors offer a variety of products and services
related to the smart grid, and come from a number of industries, including traditional meter manufacturers, application developers, telecommunications and other service providers. We compete with traditional meter manufacturers that incorporate
various communications technologies that provide some level of connectivity to the utilitys back office. Our key competitors currently include Echelon Corporation, Elster Group

SE, Itron Inc., Landis+Gyr AG, which was acquired by Toshiba Corporation, Sensus Metering Systems Inc. and Trilliant Holdings, Inc. Similarly, we compete with traditional providers of
distribution automation equipment, such as S&C Electric Company and Schweitzer Engineering Laboratories, Inc. We also face competition from newer entrants that are providing specific narrowly focused products for the smart grid, including
Coulomb Technologies Inc., Grid Net Inc., OPOWER Inc. and Tendril Networks Inc. Furthermore, other large companies such as Alcatel-Lucent, AT&T Inc., Cisco Systems, Inc., Enel SpA, Électricité Réseau Distribution France,
Fujitsu Limited, General Electric Company, International Business Machines Corporation, Mitsubishi Corporation, Motorola Solutions, Inc., Siemens AG, Sprint Nextel Corporation and Verizon Communications Inc. have announced plans to pursue business
opportunities related to the smart grid. As we look to expand into new international markets, we expect to face additional competitors that may be more established in specific geographies. We anticipate that in the future, additional competitors
will emerge that offer a broad range of competing products and services related to the smart grid.

Several of our competitors enjoy substantial competitive advantages such as:



greater name recognition and longer operating histories;



larger sales and marketing budgets and resources;



greater ability to integrate their products with existing systems;



broader distribution channels;



established relationships with existing and potential partners and utility customers;



lower labor and development costs; and



significantly greater financial, technical, customer support and other resources.

Some of these larger competitors have substantially broader
product offerings and may be able to leverage the existing relationships they have with utilities. In some cases, our larger competitors are also currently vendors of ours, and they could decide in the future to develop their own products instead of
working with us. Any inability to effectively manage these relationships could have a material adverse effect on our business, operating results, and financial condition, and accordingly affect our chances of success. In addition, some of our
competitors may have larger patent portfolios than we have, which may provide them with a competitive advantage and may require us to engage in costly litigation to protect and defend our freedom to operate and/or intellectual property rights.

Conditions in our market could change rapidly and
significantly as a result of technological advancements or market consolidation. The development and market acceptance of alternative technologies could decrease the demand for our products or render them obsolete. Our competitors may introduce
products and services that are less costly, provide superior performance or achieve greater market acceptance than our products and services. In order to remain competitive, we may need to lower prices or attempt to add incremental features and
functionality, which could negatively impact our revenue, billings, gross margin and financial condition. In addition, our larger competitors often have broader product lines and are in a better position to withstand any significant reduction in
capital spending by utilities, and will therefore not be as susceptible to downturns in a particular market. If we are unable to compete successfully in the future, our business may be harmed.

We have experienced rapid growth in recent periods. If we fail to manage our growth effectively, our financial
performance may suffer.

We have
substantially expanded our overall business, customer base, employee headcount and operations in recent periods both domestically and internationally. We increased our total number of regular full-time employees from 394 employees as of
December 31, 2009 to 570 as of September 30, 2012. Our expansion has placed, and our expected future growth will continue to place, a significant strain on our managerial, customer operations, research and development, sales and marketing,
manufacturing, administrative, financial and other resources. If we are unable to manage our growth successfully, our operating results will suffer.

We rely on our management team and need additional personnel to grow our business, and the loss of one
or more key employees or our inability to attract and retain qualified personnel could harm our business.

Our success and future growth depend on the skills, working relationships and continued services of our management team and other key
personnel. The loss of any member of our senior management team, and in particular our Chief Executive Officer, could adversely affect our business. In addition, our current senior management team has only worked together for a relatively short
period of time.

Our future success will also
depend on our ability to attract, retain and motivate highly skilled management, product development, operations, sales, technical and other personnel in the United States and abroad. Even in todays economic climate, competition for these
types of personnel is intense, particularly in the Silicon Valley, where our headquarters are located. All of our employees in the United States work for us on an at-will basis. Given the lengthy sales cycles with utilities and deployment periods of
our networking platform and solutions, the loss of key personnel could adversely affect our business.

Volatility or lack of performance in our stock price may also affect our ability to attract and retain our senior management and key
personnel. Many of our longest-tenured employees, including members of our senior management and key personnel with deep institutional knowledge, hold significant vested stock options and shares of our common stock. Employees may be more likely to
leave us if the shares they own or the shares underlying their vested stock options have significantly appreciated in value relative to the original purchase prices of the shares or the exercise prices of the options, or if the exercise prices of
the options that they hold are significantly above the market price of our common stock. We may find it difficult to retain these employees following this offering. As a result of these factors, we may be unable to attract or retain qualified
personnel. Our inability to attract and retain the necessary personnel could adversely affect our business.

Our ability to provide bid bonds, performance bonds or letters of credit is limited and could negatively affect our ability to bid on or enter into significant long-term agreements.

We have in the past been, and may in the
future be, required to provide bid bonds or performance bonds to secure our performance under customer contracts or, in some cases, as a pre-requisite to submit a bid on a potential project. Our ability to obtain such bonds primarily depends upon
our capitalization, working capital, past performance, management expertise and reputation and external factors beyond our control, including the overall capacity of the surety market. Surety companies consider those factors in relation to the
amount of our tangible net worth and other underwriting standards that may change from time to time. Surety companies may require that we collateralize a percentage of the bond with our cash or other form of credit enhancement. Events that affect
surety markets generally may result in bonding becoming more difficult to obtain in the future, or being available only at a significantly greater cost. In addition, some of our utility customers also require collateral guarantees in the form of
letters of credit to secure performance or to fund possible damages as the result of an event of default under our contracts with them. If we enter into significant long-term agreements that require the issuance of letters of credit, our liquidity
could be negatively impacted. Our inability to obtain adequate bonding or letters of credit and, as a result, to bid or enter into significant long-term agreements, could have a material adverse effect on our future revenues and business prospects.

We are subject to international business uncertainties.

Our ability to grow our business and our
future success will depend to a significant extent on our ability to expand our operations and customer base worldwide. Operating in international markets requires significant resources and management attention, and other than our operations in
Australia and Brazil, we have limited experience entering new geographic markets. There can be no assurance that our international efforts will be successful. International sales and operations may be subject to risks such as:

lack of a well-established system of laws and enforcement of those laws;

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lack of a legal system free of undue influence or corruption;

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exposure to a business culture in which improper sales practices may be prevalent;

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political instability;

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terrorist activities;

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restrictions on the import or export of critical technology;



currency exchange rate fluctuations;



adverse tax burdens;



lack of availability of qualified third-party financing;

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generally longer receivable collection periods than in the United States;



trade restrictions;



changes in tariffs;



labor disruptions;



difficulties in staffing and managing foreign operations;



preference for local vendors;



burdens of complying with different permitting standards; and



a wide variety of foreign laws and obstacles to the repatriation of earnings and cash.

Fluctuations in the value of the U.S. dollar may impact our
ability to compete in international markets. International expansion and market acceptance depend on our ability to modify our business approach and technology to take into account such factors as differing customer business models, product
requirements and needs, the applicable regulatory and business environment, labor costs and other economic conditions. In addition, the laws of certain countries do not protect our intellectual property to the same extent as do the laws of the
United States. There can be no assurance that these factors will not have a material adverse effect on our future international sales and, consequently, on our business, financial condition and results of operations.

Developments in data protection laws and regulations may affect
technology relating to smart grid products and solutions, which could adversely affect the demand for our products and solutions.

Our products and services may be subject to data protection laws and regulations that impose a general framework for the collection,
processing and use of personal data. Our networking platform and solutions rely on the transfer of data relating to individual energy use and may be affected by these laws and regulations. It is unclear how the regulations governing the transfer of
personal data in connection with privacy requirements will further develop in the United States and internationally, and to what extent this may affect technology relating to smart grid products and solutions. This could have a material adverse
effect on our business, financial condition and results of operations.

Adverse changes in general economic or political conditions in any of the major countries in which we do business could adversely affect our operating results.

Our business can be affected by a number of factors that are
beyond our control, such as general geopolitical, economic, and business conditions. The recent global macroeconomic downturn had and the continued global economic uncertainty, concerns over the downgrade of U.S. sovereign debt and continued

monetary, financial and sovereign debt uncertainties in European and other foreign countries continue to have a negative effect on our business. Further, the recent worldwide financial and credit
crisis has reduced the availability of liquidity and credit to fund the continuation and expansion of business operations worldwide. Even with economic recovery, it may take time for our utility customers or potential utility customers to establish
new budgets and return to normal purchasing patterns. We cannot predict the reoccurrence of any economic slowdown or the strength or sustainability of the economic recovery, worldwide, in the United States or in our industry. These and other
economic factors could adversely affect the demand for our products and services and, consequently, on our business, financial condition and results of operations.

There can be no assurance that a deterioration in financial
markets will not impair our ability or our utility customers ability to obtain financing in the future, including, but not limited to, our or our utility customers ability to incur indebtedness if that became necessary. In addition,
there could be a number of follow-on effects from the credit crisis on our business, including insolvency of certain of our key utility customers or suppliers, which could result in the inability of our utility customers to obtain credit to finance
purchases of our products.

In order to remain competitive, obtain key competencies or accelerate our time to market, we may seek to acquire additional businesses,
products or technologies. To date, we have completed only one small acquisition, and we therefore have limited experience in successfully acquiring and integrating additional businesses, products or technologies. If we identify an appropriate
acquisition candidate, we may not be successful in negotiating the terms of the acquisition, financing the acquisition, or effectively integrating the acquired business, product or technology into our existing business and operations. We may have
difficulty integrating acquired technologies or products with our existing products and services. Our due diligence may fail to identify all of the problems, liabilities or other shortcomings or challenges of an acquired business, product or
technology, including issues related to intellectual property, product quality or product architecture, regulatory compliance practices, revenue recognition or other accounting practices or employee or customer issues. If we finance acquisitions by
issuing convertible debt or equity securities, our existing stockholders may be diluted which could affect the market price of our stock. In addition, any acquisitions we are able to complete may not result in the synergies or any other benefits we
had expected to achieve, which could result in substantial write-offs. Further, contemplating or completing an acquisition and integrating an acquired business, product or technology will significantly divert management and employee time and
resources.

Our business may suffer if it is alleged or
found that our products infringe the intellectual property rights of others.

Our industry is characterized by the existence of a large number of patents and by litigation based on allegations of infringement or other violations of intellectual property rights. Moreover, in recent
years, individuals and groups have purchased patents and other intellectual property assets for the purpose of making claims of infringement in order to extract settlements from companies like ours. From time to time, third parties have claimed and
may continue to claim that we are infringing upon their patents or other intellectual property rights. For example, we are currently engaged in litigation as further described in BusinessLegal Proceedings. In addition, we may be
contractually obligated to indemnify our utility customers or other third parties that use or resell our products in the event our products are alleged to infringe a third partys intellectual property rights. Responding to such claims,
regardless of their merit, can be time consuming, costly to defend in litigation, divert managements attention and resources, damage our reputation and brand, and cause us to incur significant expenses. Even if we are indemnified against such
costs, the indemnifying party may be unable to uphold its contractual obligations. Further, claims of intellectual property infringement might require us to redesign affected products, delay affected product offerings, enter into costly settlement
or license agreements or pay costly damage awards or face a temporary or permanent injunction prohibiting us from marketing, selling or distributing the affected products. If we cannot or do not license the alleged infringed technology on reasonable

terms or at all, or substitute similar technology from another source, our revenue and earnings could be adversely impacted. Additionally, our utility customers may not purchase our products if
they are concerned that our products infringe third-party intellectual property rights. This could reduce the market opportunity for the sale of our products and services. The occurrence of any of these events may have a material adverse effect on
our business, financial condition and results of operations.

The success of our business depends on our ability to protect and enforce our intellectual property rights.

We rely on a combination of patent, trademark, trade dress,
copyright, unfair competition and trade secret laws, as well as confidentiality procedures and contractual restrictions, to establish and protect our proprietary rights. These laws, procedures and restrictions provide only limited protection and any
of our intellectual property rights may be challenged, invalidated, circumvented, infringed or misappropriated. Further, the laws of certain countries do not protect proprietary rights to the same extent as the laws of the United States and,
therefore, in certain jurisdictions, we may be unable to protect our proprietary technology adequately against unauthorized third-party copying, infringement or use, which could adversely affect our competitive position.

As of September 30, 2012, we had 35 patents issued
and 85 patent applications pending in the United States and, in foreign jurisdictions, we had 33 patents granted and 233 patent applications pending, which are collectively based on 56 U.S. patent applications. Our patents expire at
various times between 2015 and 2031. We cannot ensure that any of our pending applications will be granted or that any of our issued patents will adequately protect our intellectual property. In addition, third parties have in the past and could in
the future bring infringement, invalidity, co-inventorship, re-examination, or similar claims with respect to any of our currently issued patents or any patents that may be issued to us in the future. Any such claims, whether or not successful,
could be extremely costly to defend, divert managements attention and resources, damage our reputation and brand, and substantially harm our business and results of operations.

In order to protect or enforce our patent rights, protect our trade secrets or know-how, or determine the
enforceability, scope and validity of the proprietary rights of others, we may initiate patent litigation or other proceedings against third parties, such as infringement suits or interference proceedings. Any lawsuits or proceedings that we
initiate could be expensive, take significant time and divert managements attention from other business concerns. Litigation and other proceedings also put our patents at risk of being invalidated or interpreted narrowly and our patent
applications at risk of not issuing. Additionally, we may provoke third parties to assert claims against us. We may not prevail in any lawsuits or other proceedings that we initiate and the damages or other remedies awarded, if any, may not be
commercially valuable. The occurrence of any of these events may have a material adverse effect on our business, financial condition and results of operations.

Some of our products rely on technologies developed or licensed by third parties. We may seek to license technology from third parties for
future products and services. We may not be able to obtain or continue to obtain licenses and technologies from these third parties on commercially reasonable terms or at all. Our inability to retain our current third-party licenses or obtain
third-party licenses required to develop new products or product enhancements could require us to obtain alternate technology that may be of lower quality or performance standards or at greater cost, or could require that we change our product and
design plans, any of which could limit or delay our ability to manufacture and sell our products.

If we are unable to protect the confidentiality of our proprietary information, the value of our technology and products could be adversely affected.

In addition to patented technology, we rely on our
unpatented technology and trade secrets. We generally seek to protect this information by confidentiality, non-disclosure and assignment of invention agreements with our employees and contractors and with parties with which we do business. These
agreements may be breached and we may not have adequate remedies for any such breach. We cannot be certain that the steps we have taken will prevent unauthorized use or reverse engineering of our technology. Moreover, our trade secrets may be

disclosed to or otherwise become known or be independently developed by competitors. To the extent that our employees, contractors, or other third parties with whom we do business use
intellectual property owned by others in their work for us, disputes may arise as to the rights in related or resulting know-how and inventions. If, for any of the above reasons, our intellectual property is disclosed or misappropriated, it would
harm our ability to protect our rights and have a material adverse effect on our business, financial condition, and results of operations.

We use open source software in our products and services that may subject our products and services to general release or require us to re-engineer
our products and services, which may cause harm to our business.

We use open source software in connection with our products and services. From time to time, companies that incorporate open source software into their products have faced claims challenging the ownership
of open source software and/or compliance with open source license terms. Therefore, we could be subject to suits by parties claiming ownership of what we believe to be open source software or noncompliance with open source licensing terms. Some
open source software licenses require users who distribute open source software as part of their software to publicly disclose all or part of the source code to such software and/or make available any derivative works of the open source code on
unfavorable terms or at no cost. While we monitor the use of open source software in our products and services and try to ensure that none is used in a manner that would require us to disclose the source code to the related product or that would
otherwise breach the terms of an open source agreement, such use could inadvertently occur and we may be required to release our proprietary source code, pay damages for breach of contract, re-engineer our products, discontinue the sale of our
products in the event re-engineering cannot be accomplished on a timely basis or take other remedial action that may divert resources away from our development efforts, any of which could adversely affect our business, operating results and
financial condition.

We are an emerging growth
company, and any decision on our part to comply with certain reduced disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors.

We are an emerging growth company, as defined in
the Jumpstart Our Business Startups Act enacted in April 2012, and, for as long as we continue to be an emerging growth company, we may choose to take advantage of exemptions from various reporting requirements applicable to other public companies
including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding executive compensation in our periodic reports and proxy
statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved. We could be an emerging growth company for up to five
years, although, if the market value of our common stock that is held by non-affiliates exceeds $700 million as of June 30 of any year before the end of that five-year period, we would cease to be an emerging growth company as of
December 31 of that year. We cannot predict if investors will find our common stock less attractive if we choose to rely on these exemptions. If some investors find our common stock less attractive as a result of any choices to reduce future
disclosure, there may be a less active trading market for our common stock and our stock price may decline or be more volatile.

Under Section 107(b) of the Jumpstart Our Business Startups Act, emerging growth companies can delay adopting new or revised accounting
standards until such time as those standards apply to private companies. We have irrevocably elected not to avail ourself of this exemption from new or revised accounting standards and, therefore, we will be subject to the same new or revised
accounting standards as other public companies that are not emerging growth companies.

Our business is subject to changing regulations regarding corporate governance and public disclosure that will increase both our costs and the risk of noncompliance.

As a public company, we will be subject to the reporting
requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, and the

rules and regulations of the New York Stock Exchange. Achieving and maintaining compliance with these rules and regulations, particularly after we cease to be an emerging growth company, will
increase our legal, accounting and financial compliance costs, will make some activities more difficult, time-consuming and costly and may also place undue strain on our personnel, systems and resources.

The Sarbanes-Oxley Act requires, among other things, that we
maintain effective disclosure controls and procedures and, in the future, internal control over financial reporting. Any failure to develop or maintain effective controls, or any difficulties encountered in their implementation or improvement, could
harm our operating results or cause us to fail to meet our reporting obligations and may result in a restatement of our prior period financial statements. Any failure to implement and maintain effective internal controls also could adversely affect
the results of periodic management evaluations regarding the effectiveness of our internal control over financial reporting that we will be required to include in our periodic reports filed with the SEC, beginning for the year ending
December 31, 2013 under Section 404(a) of the Sarbanes-Oxley Act or the annual auditor attestation reports regarding effectiveness of our internal controls over financial reporting that we will be required to include in our annual reports
filed with the SEC, beginning for our year ending December 31, 2017, unless, under the Jumpstart Our Business Startups Act, we meet certain criteria that would require such reports to be included prior to then, under Section 404(b) of the
Sarbanes-Oxley Act. Ineffective disclosure controls and procedures and internal control over financial reporting could also cause investors to lose confidence in our reported financial and other information, which would likely have a negative effect
on the trading price of our common stock.

In
order to maintain the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we will need to expend significant resources and provide significant management oversight. We have a substantial effort
ahead of us to implement appropriate processes, document our system of internal control over relevant processes, assess their design, remediate any deficiencies identified and test their operation. As a result, managements attention may be
diverted from other business concerns, which could harm our business, operating results and financial condition. These efforts will also involve substantial accounting-related costs. In addition, if we are unable to continue to meet these
requirements, we may not be able to remain listed on the New York Stock Exchange.

Implementing any appropriate changes to our internal controls may require specific compliance training of our directors, officers and employees, entail substantial costs in order to modify our existing
accounting systems, and take a significant period of time to complete. Such changes may not, however, be effective in maintaining the adequacy of our internal controls, and any failure to maintain that adequacy, or consequent inability to produce
accurate financial statements on a timely basis, could increase our operating costs and could materially impair our ability to operate our business. In the event that we are not able to demonstrate compliance with Section 404 of the
Sarbanes-Oxley Act in a timely manner, that our internal controls are perceived as inadequate or that we are unable to produce timely or accurate financial statements, investors may lose confidence in our operating results and our stock price could
decline.

The Sarbanes-Oxley Act and the rules and
regulations of the New York Stock Exchange will make it more difficult and more expensive for us to maintain directors and officers liability insurance, and we may be required to accept reduced coverage or incur substantially higher
costs to maintain or increase coverage. If we are unable to maintain adequate directors and officers insurance, our ability to recruit and retain qualified directors, especially those directors who may be considered independent for
purposes of the New York Stock Exchange rules, and officers may be curtailed.

We may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs.

In the future, we may require additional capital to respond
to business opportunities, challenges, acquisitions or unforeseen circumstances and may determine to engage in equity or debt financings or enter into credit facilities for other reasons. For example, in December 2011, we entered into a note
purchase agreement with

EMC and issued a convertible note with an aggregate principal amount of $24.0 million and the option to borrow up to an additional $6.0 million in subsequent closings upon the
achievement of certain financial milestones. Similarly, in February 2012, we entered into a note purchase agreement with Hitachi and issued a convertible note with an aggregate principal amount of $30.0 million. In the future, we may not be able to
timely secure additional debt or equity financing on favorable terms, or at all. Any debt financing obtained by us in the future could involve restrictive covenants relating to our capital raising activities and other financial and operational
matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential acquisitions. If we raise additional funds through further issuances of equity, convertible debt securities or
other securities convertible into equity, our existing stockholders could suffer significant dilution in their percentage ownership of our company, and any new equity securities we issue could have rights, preferences and privileges senior to those
of holders of our common stock, including shares of common stock sold in this offering. If we are unable to obtain adequate financing or financing on terms satisfactory to us, when we require it, our ability to continue to grow or support our
business and to respond to business challenges could be significantly limited.

We may not be able to utilize a significant portion of our net operating loss or research tax credit carryforwards, which could adversely affect our operating results.

As of December 31, 2011, we had federal and state net
operating loss carryforwards due to prior period losses, which if not utilized will begin to expire in 2029 and 2015 for federal and state purposes, respectively. We also have federal research tax credit carryforwards that will begin to expire in
2024. Realization of these net operating loss and research tax credit carryforwards is dependent upon future income, and there is a risk that our existing carryforwards could expire unused and be unavailable to offset future income tax liabilities,
which could adversely affect our operating results.

In addition, under Section 382 of the Internal Revenue Code of 1986, as amended, or the Code, our ability to utilize net operating
loss carryforwards or other tax attributes, such as research tax credits, in any taxable year may be limited if we experience an ownership change. A Section 382 ownership change generally occurs if one or more
stockholders or groups of stockholders who own at least 5% of our stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period. Similar rules may apply under state tax
laws. This offering or future issuances of our stock could cause an ownership change. It is possible that an ownership change, or any future ownership change, could have a material effect on the use of our net operating loss
carryforwards or other tax attributes, which could adversely affect our operations results. As of December 31, 2011, $40.5 million of the net operating loss carryforwards are subject to an annual limitation.

Our business and financial performance could be negatively impacted by
changes in tax laws or regulations.

New
income, sales, use or other tax laws, statutes, rules, regulations or ordinances could be enacted at any time. Those enactments could adversely affect our domestic and international business operations, and our business and financial performance.
Further, existing tax laws, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us. These events could require us or our utility customers to pay additional tax amounts on a prospective or
retroactive basis, as well as require us or our utility customers to pay fines and/or penalties and interest for past amounts deemed to be due. If we raise our prices to offset the costs of these changes, existing and potential future utility
customers may elect not to continue or purchase our products and services in the future. Additionally, new, changed, modified or newly interpreted or applied tax laws could increase our utility customers and our compliance, operating and other
costs, as well as the costs of our products. Further, these events could decrease the capital we have available to operate our business. Any or all of these events could adversely impact our business and financial performance.

There has been no prior market for our common stock, our stock price
may be volatile or may decline regardless of our operating performance, and you may not be able to resell your shares at or above the initial public offering price.

There has been no public market for our common stock prior
to this offering. The initial public offering price for our common stock will be determined through negotiations between the underwriters and us and may vary from the market price of our common stock following this offering. If you purchase shares
of our common stock in this offering, you may not be able to resell those shares at or above the initial public offering price. An active or liquid market in our common stock may not develop upon closing of this offering or, if it does develop, it
may not be sustainable. The trading prices of the securities of technology companies have been highly volatile. The market price of our common stock may fluctuate significantly in response to numerous factors, many of which are beyond our control,
including:



actual or anticipated fluctuations in our billings, revenue and other operating results;



the financial projections we may provide to the public, any changes in these projections or our failure to meet these projections;



failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our
company, or our failure to meet these estimates or the expectations of investors;

changes in operating performance and stock market valuations of utilities, technology companies generally, or those in our industry in particular;



political and consumer sentiment, including concerns over accuracy of advanced metering technology, economic impact on consumers, privacy, security,
consumer choice and the safety, health and environmental aspects of smart grid technology;

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price and volume fluctuations in the overall stock market, including as a result of trends in the economy as a whole;



lawsuits threatened or filed against us; and



other events or factors, including those resulting from war, incidents of terrorism or responses to these events.

In addition, the stock markets, and in particular the New
York Stock Exchange on which our common stock will be listed, have experienced extreme price and volume fluctuations that have affected and continue to affect the market prices of equity securities of many technology companies. Stock prices of many
technology companies have fluctuated in a manner unrelated or disproportionate to the operating performance of those companies. In the past, stockholders have instituted securities class action litigation following periods of market volatility. If
we were to become involved in securities litigation, it could subject us to substantial costs, divert resources and the attention of management from our business and adversely affect our business, operating results and financial condition.

A significant portion of our total outstanding shares may
be sold into the market in the near future. If there are substantial sales of shares of our common stock, the price of our common stock could decline.

The price of our common stock could decline if there are substantial sales of our common stock, particularly sales by our directors,
executive officers and significant stockholders, or if there is a large number of shares of our common stock available for sale. After this offering and the concurrent private placement, we will have

outstanding shares of our common stock, based on the number of shares outstanding as of September 30, 2012 and the
conversion of our convertible preferred stock and convertible notes based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the
cover of this prospectus. This includes the shares that we are selling in this offering, which may be resold in the public market immediately. The remaining shares, including
those shares issued in the concurrent private placement, or % of our outstanding shares after this offering and the concurrent private placement, are currently restricted as a result of market standoff and/or lock-up
agreements but will be able to be sold in the near future as set forth below.

Date Available for Sale

into Public Market

Number of Shares and

% of Total Outstanding

Immediately after the date of this prospectus

shares, or %,

181 days after the date of this prospectus (subject to extension)

shares, or %, of
which , or %, shares will be subject to limitations under Rules 144 and 701

After this offering and
the concurrent private placement, the holders of an aggregate of shares of our common stock, based on the number of shares
outstanding as of September 30, 2012, and the conversion of our convertible preferred stock and convertible notes at an assumed initial public offering price of $ per
share, the midpoint of the range set forth on the cover of this prospectus, and shares subject to a warrant to purchase our common stock outstanding as of September 30,
2012, will have rights, subject to some conditions, to require us to file registration statements covering their shares or to include their shares in registration statements that we may file for ourselves or our stockholders. All of these shares are
subject to market standoff and lock-up agreements restricting their sale for 180 days, subject to extension, after the date of this prospectus. We also intend to register shares of common stock that we have issued and may issue under our
employee equity incentive plans. Once we register these shares, they will be able to be sold freely in the public market upon issuance, subject to existing market standoff and lock-up agreements. Morgan Stanley & Co. LLC and Goldman,
Sachs & Co. may, in their sole discretion, permit one or more parties who are subject to the contractual lock-up to sell shares prior to the expiration of the lock-up agreements.

The market price of the shares of our common stock could decline as a result of sales of a substantial number
of our shares in the public market or the perception in the market that the holders of a large number of shares intend to sell their shares.

We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.

We cannot specify with any certainty the particular uses of
the net proceeds that we will receive from this offering. Our management will have broad discretion in the application of the net proceeds, including working capital, possible acquisitions and other general corporate purposes, and we may spend or
invest these proceeds in a way with which our stockholders disagree. The failure by our management to apply these funds effectively could harm our business and financial condition. Pending their use, we may invest the net proceeds from this offering
in a manner that does not produce income or that loses value. These investments may not yield a favorable return to our investors.

If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and
trading volume could decline.

The
trading market for our common stock will depend in part on the research and reports that securities or industry analysts publish about us or our business. We currently do not have and may never obtain research coverage by securities analysts, and
industry analysts that currently cover us may cease to do so. If no securities analysts commence coverage of our company, or if industry analysts cease coverage of our company, the trading price for our stock would be negatively impacted. In the
event we obtain securities analyst coverage, if one or

more of the analysts who cover us downgrade our stock or publish inaccurate or unfavorable research about our business, our stock price would likely decline. If one or more of these analysts
cease coverage of our company or fail to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline.

Our directors, executive officers and principal stockholders will
continue to have substantial control over us after this offering and the concurrent private placement and could delay or prevent a change in corporate control.

Entities affiliated with Foundation Capital have agreed
to purchase an aggregate of $12 million of shares of our common stock in the concurrent private placement at the price offered to the public, or shares based on an assumed
initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus. As of September 30, 2012, after this offering and the concurrent private
placement, our directors, executive officers and holders of more than 5% of our common stock, together with their affiliates, will beneficially own, in the aggregate, % of our outstanding common stock, which is based on an
assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus. As a result, these stockholders, acting together, would have the ability to
control the outcome of matters submitted to our stockholders for approval, including the election of directors and any merger, consolidation or sale of all or substantially all of our assets. In addition, these stockholders, acting together, would
have the ability to control the management and affairs of our company. Accordingly, this concentration of ownership might harm the market price of our common stock by:



delaying, deferring or preventing a change in control of us;



impeding a merger, consolidation, takeover or other business combination involving us; or



discouraging a potential acquiror from making a tender offer or otherwise attempting to obtain control of us.

Sale of shares to entities affiliated with Foundation Capital in the
concurrent private placement will reduce the available public float for our shares.

Entities affiliated with Foundation Capital have agreed to purchase shares of our common stock with an aggregate purchase price of $12 million in the concurrent private placement at the price offered to
the public, or shares based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on
the cover of this prospectus. As of September 30, 2012, entities affiliated with Foundation Capital beneficially owned approximately 41.2% of our common stock. The sale of these shares to entities affiliated with Foundation Capital will not be
registered in this offering. Following this offering and the concurrent private placement, the number of shares beneficially owned by entities affiliated with Foundation Capital after this offering will be as set forth in the beneficial ownership
table in Principal Stockholders. In addition, the concurrent private placement will reduce the available public float for our shares because these entities will be restricted from selling the shares pursuant to lock-up agreements they
have entered into with the underwriters in this offering and pursuant to restrictions under applicable securities laws. As a result, the sale of shares in the concurrent private placement will reduce the liquidity of our common stock relative to
what it would have been had these shares been sold in this offering and been purchased by investors that were not affiliated with us.

We do not intend to pay dividends for the foreseeable future.

We have never declared or paid cash dividends on our
capital stock. We currently intend to retain any future earnings to finance the operation and expansion of our business, and we do not expect to declare or pay any dividends in the foreseeable future. In addition, the terms of our credit facility
with Silicon Valley Bank currently restricts our ability to pay dividends. As a result, you may only receive a return on your investment in our common stock if the market price of our common stock increases.

If you purchase shares of our common stock in this offering, you will experience substantial and
immediate dilution.

If you purchase
shares of our common stock in this offering, you will experience substantial and immediate dilution in the pro forma net tangible book value per share after giving effect to this offering and the concurrent private placement of
$ per share as of September 30, 2012, based on an assumed initial public offering price of $ per share,
which is the midpoint of the range set forth on the cover of this prospectus, because the price that you pay will be substantially greater than the pro forma net tangible book value per share of the common stock that you acquire. This dilution is
due in large part to the fact that our earlier investors paid substantially less than the initial public offering price when they purchased their shares of our capital stock. You will experience additional dilution upon exercise of warrants and
stock options to purchase common stock and when we issue restricted stock to our employees under our equity incentive plans or otherwise issue additional shares of our common stock.

Delaware law and provisions in our amended and restated certificate of incorporation and bylaws could make a merger,
tender offer or proxy contest difficult, thereby depressing the trading price of our common stock.

We are a Delaware corporation and the anti-takeover provisions of the Delaware General Corporation Law may discourage, delay or prevent a
change in control by prohibiting us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change of control would be beneficial to our
existing stockholders. In addition, our restated certificate of incorporation and restated bylaws to be in effect immediately upon the closing of this offering will contain provisions that may make the acquisition of our company more difficult
without the approval of our Board of Directors, including the following:



our Board of Directors will be classified into three classes of directors with staggered three-year terms;



only our chairman of the board, our lead independent director, our chief executive officer, our president or a majority of our Board of Directors will
be authorized to call a special meeting of stockholders;



our stockholders will only be able to take action at a meeting of stockholders and not by written consent;



vacancies on our Board of Directors will be able to be filled only by our Board of Directors and not by stockholders;



directors may be removed from office only for cause;



our restated certificate of incorporation will authorize undesignated preferred stock, the terms of which may be established, and shares of which may
be issued, without stockholder approval; and



advance notice procedures will apply for stockholders to nominate candidates for election as directors or to bring matters before an annual meeting of
stockholders.

For information
regarding these and other provisions, see Description of Capital Stock.

This prospectus includes
forward-looking statements. All statements, other than statements of historical fact, contained in this prospectus, including statements regarding our billings, backlog, revenue and other aspects of our future results of operations, financial
position and cash flows, our business strategy and plans and our objectives for future operations, are forward-looking statements. The words believe, may, will, estimate, continue,
anticipate, would, could, should, intend and expect and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements
largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives,
and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Risk Factors. Moreover, we operate in a very competitive and rapidly changing
environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual
results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties and assumptions, the future events and trends discussed in this prospectus may not occur and actual results could
differ materially and adversely from those anticipated or implied in the forward-looking statements.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements. We are under no duty to update any of these forward-looking statements after the date of this prospectus or to conform these statements to actual results or revised expectations.

This prospectus also contains estimates and other information
concerning our industry, including market size and growth rates of the markets in which we participate, that are based on industry publications, surveys and forecasts, including those generated by Pike Research and IDC Energy Insights. This
information involves a number of assumptions and limitations, and you are cautioned not to give undue weight to these estimates. Although we believe the information in these industry publications, surveys and forecasts is reliable, we have not
independently verified the accuracy or completeness of the information. The industry in which we operate is subject to a high degree of uncertainty and risk due to a variety of factors including those described in Risk Factors.

We estimate that our net proceeds from the sale of the common
stock in this offering, excluding the proceeds from the concurrent private placement, will be approximately $ million, assuming an initial public offering price of
$ per share (the midpoint of the range listed on the cover of this prospectus), after deducting underwriting discounts and commissions and estimated offering expenses. A
$1.00 increase (decrease) in the assumed initial public offering price of $ per share would increase (decrease) the net proceeds to us from this offering by
$ million, assuming the number of shares offered by us, as set forth on the cover of this prospectus, remains the same, after deducting underwriting discounts and
commissions and estimated offering expenses. Our proceeds from the sale of the common stock sold in the concurrent private placement will be $12 million. For more information, please see Certain Relationships and Related Party
TransactionsConcurrent Private Placement and Warrant Termination.

The principal purposes of this offering are to create a public market for our common stock, obtain additional capital, facilitate our future access to the public equity markets, increase awareness of our
company among potential utility customers and improve our competitive position. We intend to use the net proceeds to us from this offering and the concurrent private placement for working capital and other general corporate purposes. In addition, we
will use a portion of our existing cash balance to make payment to certain stockholders as consideration for the termination of warrants to purchase shares of our convertible preferred stock held by those stockholders immediately prior to the
effectiveness of this registration statement. For more information, please see Certain Relationships and Related Party TransactionsConcurrent Private Placement and Warrant Termination. Additionally, we may choose to expand our
current business through acquisitions of, or investments in, other businesses, products or technologies, using cash or shares of our common stock. However, we have no commitments to use the proceeds for any such acquisitions or investments at this
time.

Pending the use of proceeds from this
offering, we intend to invest the net proceeds in short-term, interest-bearing, investment-grade securities. Our management will have broad discretion in the application of the net proceeds from this offering and investors will be relying on the
judgment of our management regarding the application of the proceeds.

DIVIDEND POLICY

We have never declared or paid cash dividends on our capital stock. We currently intend to retain any future earnings and do not expect to declare or pay any dividends in the foreseeable future. Any
future determination to pay dividends on our capital stock will be at the discretion of our Board of Directors and will depend on our financial condition, results of operations, capital requirements and other factors that our Board of Directors
considers relevant. In addition, the terms of our credit facility with Silicon Valley Bank currently restrict our ability to pay dividends.

The following table sets forth our capitalization as of
September 30, 2012 on:



an actual basis;



a pro forma basis to give effect to (a) the assumed conversion of all outstanding shares of our convertible preferred stock into an aggregate of
shares of our common stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range
set forth on the cover of this prospectus, (b) the conversion of our convertible notes, together with accrued interest thereon, into shares of common stock, which is based
on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, (c) the reclassification of the compound
embedded derivative liability related to the convertible notes to additional paid-in capital, (d) the reclassification of a portion of Series A and all Series E preferred stock warrant liability to additional paid-in capital, and (e) the
vesting and issuance of shares of common stock to the holders of restricted stock units, each immediately prior to the closing of this offering; and



a pro forma as adjusted basis to reflect (a) the pro forma adjustments described above, (b) the reduction of warrant liability as a result of the
termination of certain warrants immediately prior to the effectiveness of this registration statement and (c) the issuance and sale of shares of common stock in this
offering and the concurrent private placement, and the receipt of the net proceeds from our sale of these shares at an assumed initial public offering price of $ per share, the midpoint of the
range listed on the cover of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses.

The information below is illustrative only and our capitalization following the closing of this offering and the concurrent private
placement will be adjusted based on the actual initial public offering price and other terms of this offering determined at pricing. You should read the information in this table together with the section entitled Managements Discussion
and Analysis of Financial Condition and Results of Operations and our consolidated financial statements and the related notes appearing elsewhere in this prospectus.

A $1.00 increase (decrease) in the assumed initial public offering price of $ per share
would increase (decrease) the amount of additional paid-in capital, total stockholders equity and total capitalization by approximately $ million, assuming the number
of shares offered, as set forth on the cover of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated offering expenses. Similarly, each increase (decrease) of one million shares in the number of
shares offered would increase (decrease), additional paid-in capital, total stockholders equity and total capitalization by approximately $ million, assuming the
assumed initial public offering price remains the same and after deducting underwriting discounts and commissions and estimated offering expenses. The pro forma as adjusted information discussed above is illustrative only and will be adjusted based
on the actual public offering price and other terms of this offering determined at pricing.

The number of shares shown as issued and outstanding in the table above is based on the number of shares of our common stock outstanding
as of September 30, 2012. This number assumes the conversion of all outstanding shares of our convertible preferred stock and our outstanding convertible notes based on an assumed initial public offering price of
$ per share, the midpoint of the range set forth on the cover of this prospectus, as discussed in further detail in Description of Capital Stock, and excludes:



24,310,095 shares of common stock issuable upon the exercise of options outstanding under our equity incentive plans with a weighted average
exercise price of approximately $4.38 per share, which weighted average exercise price will be reduced to $ , based on an assumed initial public offering price of
$ per share, the midpoint of the range set forth on the cover of this prospectus, following the modification of stock options held by current employees and directors as of the date of this offering
with an exercise price of $6.98 per share or greater to reduce the exercise price to a price equal to the initial public offering price;



1,180,782 shares of common stock issuable upon the settlement of restricted stock units outstanding under our equity incentive plans, 468,829 of
which will be issued upon the effectiveness of the registration statement;



9,456,040 shares of common stock available for future issuance under our existing equity incentive plans and on the day our 2012 Equity Incentive
Plan becomes effective, any remaining shares available for future issuance will be added to the shares reserved for issuance under our 2012 Equity Incentive Plan and we will cease granting awards under our existing equity incentive plans;



17,000,000 shares of common stock reserved for future issuance under our 2012 Equity Incentive Plan, which will become effective on the day before the
date the registration statement is declared effective, including:



243,154 shares of our common stock that will be issuable upon the settlement of restricted stock units that vest upon the effectiveness of the
registration statement and 2,843,808 shares of our common stock that will be issuable upon the settlement of restricted stock units or the exercise of options to purchase common stock with an exercise price per share equal to the initial public
offering price that will vest over time, all of which will be granted on the day that this registration statement is declared effective and that were communicated to employees, but not granted, during the period between February 2012 and the date of
this prospectus; and



up to 10,000,000 shares of our common stock in equity awards that we expect to grant to existing employees, including executive officers, for
additional retention purposes shortly following the closing of this offering;



2,000,000 shares of common stock reserved for future issuance under our 2012 Employee Stock Purchase Plan, which will be become effective on the day
the registration statement is declared effective; and

250,000 shares of common stock issuable upon exercise of warrants at an exercise price of $0.001 per share,
shares of common stock issuable upon exercise of convertible preferred stock warrants that will convert into warrants to purchase shares of common stock upon closing of
this offering, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, at a weighted average exercise price of
$ per share. It also excludes warrants that will terminate immediately prior to the effectiveness of this registration statement as described in Certain Relationships and Related Party
TransactionsConcurrent Private Placement and Warrant Termination.

As a result of anti-dilution and conversion provisions that apply to our convertible preferred stock and convertible notes, a $1.00
decrease would increase the number of shares of common stock outstanding after the offering and the concurrent private placement by shares, and a $1.00 increase would decrease
the number of shares of common stock outstanding after the offering by shares.

If you invest in our common stock, you will experience
immediate and substantial dilution in the pro forma as adjusted net tangible book value per share of our common stock after this offering and the concurrent private placement. Dilution will result from the fact that the per share offering price of
our common stock is substantially in excess of the book value per share attributable to the existing stockholders for our currently outstanding common stock.

As of September 30, 2012, our pro forma net tangible book value was approximately
$ million, or $ per share of common stock. Pro forma net tangible book value per share represents the
amount of our tangible assets less our liabilities divided by the number of shares of outstanding stock, after giving effect to (a) the assumed conversion of our convertible preferred stock into an aggregate of
shares of our common stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range
set forth on the cover of this prospectus, (b) the conversion of our convertible notes, together with accrued interest thereon, into shares of common stock, which is based on
an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, (c) the reclassification of the compound embedded derivative liability
related to the convertible note to additional paid-in capital, (d) the reclassification of a portion of Series A and all Series E preferred stock warrant liability to additional paid-in capital, and (e) the vesting and issuance of
shares of common stock to the holders of restricted stock units, each immediately prior to the closing of this offering. The net tangible book value includes deferred
revenue and the associated deferred cost of revenue.

Our pro forma as adjusted net tangible book value as of September 30, 2012 was $ million, or
$ per share of common stock; pro forma as adjusted net tangible book value per share reflects (a) the pro forma adjustments described above, (b) the reduction of warrant
liability as a result of the termination of certain warrants immediately prior to the effectiveness of this registration statement and (c) the sale and issuance of shares of
common stock in this offering and the concurrent private placement, and the receipt of the net proceeds from the sale of these shares at an assumed initial public offering price of
$ per share, the midpoint of the price range set forth on the cover of this prospectus, after deducting underwriting discounts and commissions and estimated offering expenses.
This represents an immediate increase in pro forma as adjusted net tangible book value of $ per share to existing stockholders and immediate dilution of
$ per share to new investors purchasing shares in the offering and the concurrent private placement.

The following table illustrates this dilution on a per share
basis to new investors:

Assumed initial public offering price per share

$

Pro forma net tangible book value per share as of September 30, 2012

$

Increase per share attributable to new investors in this offering and the concurrent private placement

Pro forma as adjusted net tangible book value per share after this offering and the concurrent private placement

Dilution in pro forma net tangible book value per share to new investors in this offering and the concurrent private
placement

$

A $1.00 increase in
the assumed initial public offering price of $ per share would increase the pro forma net tangible book value, as adjusted to give effect to this offering and the
concurrent private placement, by $ per share and the dilution to new investors by $ per share,
assuming the number of shares offered, as set forth on the cover of this prospectus, remains the same and after deducting underwriting discounts and commissions and estimated expenses payable by us. Similarly, each increase (decrease) of one million
shares in the number of shares of common stock offered by us would increase (decrease) the pro forma net tangible book value, as adjusted to give effect to this offering and the concurrent private placement, by
$ per share

or $ per share, respectively, and the dilution to new investors by
$ per share or $ per share, respectively, assuming the assumed initial public offering price remains
the same and after deducting underwriting discounts and commissions and estimated expenses payable by us. If the underwriters exercise their over-allotment option in full at the assumed initial public offering price, the pro forma net tangible book
value per share of our common stock, as adjusted to give effect to this offering and the concurrent private placement, would be $ per share, and the dilution in pro forma
net tangible book value per share to investors in this offering and the concurrent private placement investors would be $ per share of common stock.

The following table summarizes, on a pro forma as adjusted
basis as of September 30, 2012, the total number of shares of common stock purchased from us, the total consideration paid to us and the average price per share paid to us by existing stockholders and by new investors purchasing shares in this
offering and the concurrent private placement investors at the assumed offering price of $ per share, before deducting underwriting discounts and commissions and estimated
offering expenses.

Shares Purchased

Total Consideration

AveragePricePer Share

Number

Percent

Amount

Percent

Existing stockholders

%

%

Concurrent private placement investors

New investors

Total

100

%

100

%

The number of shares
shown as issued and outstanding in the table above is based on the number of shares of our common stock outstanding as of September 30, 2012. This number assumes the conversion of all outstanding shares of our convertible preferred stock and our
outstanding convertible notes based on an assumed initial public offering price of $ per shares, the midpoint of the range set forth on the cover of this prospectus, as discussed in further detail in
Description of Capital Stock, and excludes:



24,310,095 shares of common stock issuable upon the exercise of options outstanding under our equity incentive plans with a weighted average exercise
price of approximately $4.38 per share, which weighted average exercise price will be reduced to $ , based on an assumed initial public offering price of
$ per share, the midpoint of the range set forth on the cover of this prospectus, following the modification of stock options held by current employees and directors as of the date of this offering
with an exercise price of $6.98 per share or greater to reduce the exercise price to a price equal to the initial public offering price;



1,180,782 shares of common stock issuable upon the settlement of restricted stock units outstanding under our equity incentive plans, other than
468,829 of which will be issued upon the effectiveness of the registration statement;



9,456,040 shares of common stock available for future issuance under our existing equity incentive plans and on the day our 2012 Equity Incentive Plan
becomes effective, any remaining shares available for future issuance will be added to the shares reserved for issuance under our 2012 Equity Incentive Plan and we will cease granting awards under our existing equity incentive plans;



17,000,000 shares of common stock reserved for future issuance under our 2012 Equity Incentive Plan, which will become effective on the day before the
date the registration statement is declared effective, including:



243,154 shares of our common stock that will be issuable upon the settlement of restricted stock units that vest upon the effectiveness of the
registration statement and 2,843,808 shares of our common stock that will be issuable upon the settlement of restricted stock units or the exercise of options to purchase common stock with an exercise price per share equal to the initial public
offering price that will vest over time, all of which will be granted on the day that this registration

statement is declared effective and that were communicated to employees, but not granted, during the period between February 2012 and the date of this prospectus; and



up to 10,000,000 shares of our common stock in equity awards that we expect to grant to existing employees, including executive officers, for
additional retention purposes shortly following the closing of this offering;



2,000,000 shares of common stock reserved for future issuance under our 2012 Employee Stock Purchase Plan, which will be become effective on the day
the registration statement is declared effective; and



250,000 shares of common stock issuable upon exercise of warrants at an exercise price of $0.001 per share,
shares of common stock issuable upon exercise of convertible preferred stock warrants that will convert into warrants to purchase shares of common stock upon closing of
this offering, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, at a weighted average exercise price of
$ per share. It also excludes warrants that will terminate immediately prior to the effectiveness of this registration statement as described in Certain Relationships and Related Party
TransactionsConcurrent Private Placement and Warrant Termination.

As a result of anti-dilution and conversion provisions that apply to our convertible preferred stock and convertible notes, a $1.00
decrease would increase the number of shares of common stock outstanding after the offering and the concurrent private placement by shares, and a $1.00
increase would decrease the number of shares of common stock outstanding after the offering by shares.

To the extent that any outstanding options or warrants
are exercised, shares of common stock are issued upon the settlement of restricted stock units, new options or restricted stock units are issued under our stock-based compensation plans or we issue additional shares of common stock in the future,
including if the underwriters exercise their over-allotment option, there will be further dilution to investors participating in this offering and the concurrent private placement investors.

We have derived the following consolidated statements of
operations data for the years ended December 31, 2009, 2010 and 2011 and consolidated balance sheet data as of December 31, 2010 and 2011 from our audited consolidated financial statements included elsewhere in this prospectus. We have
derived the following consolidated statements of operations data for the years ended December 31, 2007 and 2008 and consolidated balance sheet data as of December 31, 2007, 2008 and 2009 from our audited consolidated financial statements
not included in this prospectus. We have derived the following consolidated statements of operations data for the nine months ended September 30, 2011 and 2012 and the consolidated balance sheet data as of September 30, 2012 from our unaudited
consolidated financial statements included elsewhere in this prospectus. The unaudited consolidated financial statements include, in our opinion, all adjustments, consisting only of normal recurring adjustments, that we consider necessary for the
fair presentation of the financial information set forth in those statements. Our historical results are not necessarily indicative of our results to be expected for the remainder of 2012 or in any future period. The summary of our consolidated
financial data set forth below should be read together with our consolidated financial statements, related notes and the section entitled Managements Discussion and Analysis of Financial Condition and Results of Operations
appearing elsewhere in this prospectus.

Year Ended December 31,

Nine Months EndedSeptember
30,

2007

2008

2009

2010

2011

2011

2012

(unaudited)

(in thousands, except per share amounts)

Consolidated Statements of Operations Data:

Revenue, net

$

52

$

58

$

3,297

$

70,224

$

237,050

$

175,716

$

146,666

Cost of revenue(1)

8,758

12,263

40,060

120,248

214,099

163,829

125,495

Gross profit (loss)

(8,706

)

(12,205

)

(36,763

)

(50,024

)

22,951

11,887

21,171

Operating expenses:(1)

Research and development

12,375

17,009

25,518

47,022

57,510

42,874

46,872

Sales and marketing

2,231

4,639

14,869

21,063

25,221

18,725

21,732

General and administrative

1,883

5,699

18,388

27,475

34,353

26,804

21,024

Legal settlements and amortization of acquired intangibles





4,533

166

1,097

1,099



Total operating expenses

16,489

27,347

63,308

95,726

118,181

89,502

89,628

Operating loss

(25,195

)

(39,552

)

(100,071

)

(145,750

)

(95,230

)

(77,615

)

(68,457

)

Other income (expense), net

(1,412

)

(830

)

(13,212

)

(2,553

)

3,234

1,670

219

Loss before income taxes

(26,607

)

(40,382

)

(113,283

)

(148,303

)

(91,996

)

(75,945

)

(68,238

)

Provision for income taxes

1

9

180

146

363

253

469

Net loss

$

(26,608

)

$

(40,391

)

$

(113,463

)

$

(148,449

)

$

(92,359

)

$

(76,198

)

$

(68,707

)

Net loss per share, basic and diluted

$

(3.02

)

$

(3.69

)

$

(8.48

)

$

(9.20

)

$

(5.21

)

$

(4.33

)

$

(3.75

)

Weighted average shares used to compute net loss per share, basic and diluted

Total stock-based compensation expense and common stock warrant issuance cost

$

192

$

699

$

2,052

$

6,547

$

17,332

$

13,093

$

11,823

(A)

General and administrative expense for the nine months ended September 30, 2011 and the year ended December 31, 2011 include a $2.5 million expense for the
issuance of a fully vested common stock warrant to purchase 250,000 shares of our common stock to a third party for purposes of establishing a charitable foundation following this offering.

(2)

Pro forma basic and diluted net loss per share have been calculated by dividing net loss for the period by the weighted average number of shares of common stock
outstanding during the period, net of weighted-average shares subject to repurchase, giving effect to (a) the assumed conversion of all outstanding shares of our preferred stock into an aggregate of
shares of common stock, which is based on an assumed initial public offering price of $ per share, the midpoint of the range set
forth on the cover of this prospectus, (b) the conversion of our convertible notes, together with accrued interest thereon, into shares of common stock, which is based on
an assumed initial public offering price of $ per share, the midpoint of the range set forth on the cover of this prospectus, (c) the reclassification of the compound embedded derivatives
liability related to the convertible notes to additional paid-in capital, (d) the reclassification of a portion of Series A and all Series E preferred stock warrant liability to additional paid-in capital, and (e) the vesting and issuance
of shares of common stock to the holders of restricted stock units, each immediately prior to the closing of this offering. See Note 1 to our consolidated financial statements
for more information on our calculation of pro forma net loss per share.

We believe that our results of operations
under generally accepted accounting principles, or GAAP, when considered in isolation, may only provide limited insight into the performance of our business in any given period. As a result, we manage our business, make planning decisions, evaluate
our performance and allocate resources by assessing non-GAAP measures such as billings, cost of billings, gross profit (loss) on billings, and adjusted EBITDA, in addition to other financial measures presented in accordance with GAAP. We believe
that these non-GAAP measures offer valuable supplemental information regarding the performance of our business, and will help investors better understand the sales volumes, and gross margin and profitability trends, as well as the cash flow
characteristics, of our business. These non-GAAP measures should not be considered in isolation from, are not a substitute for, and do not purport to be an alternative to, revenue, cost of revenue, gross profit (loss), net loss or any other
performance measure derived in accordance with GAAP.

Billings represent amounts invoiced for products for which ownership, typically evidenced by title and risk of loss, has transferred or services that have been provided to the customer, and for which
payment is expected to be made in accordance with normal payment terms. Billings exclude amounts for undelivered products, services to be performed in the future, and amounts paid or payable to customers. Billings are initially recorded as deferred
revenue and are recognized as revenue when all revenue recognition criteria have been met under our accounting policies as described in Managements Discussion and Analysis of Financial Condition and Results of OperationsCritical
Accounting Policies and EstimatesRevenue Recognition. We reconcile revenue to billings by adding revenue to the change in deferred revenue in a given period.

Cost of billings represents the cost associated with products
and services that have been delivered to the customer, excluding stock-based compensation and amortization of intangibles. Cost of hardware shipments for which revenue is not recognized in the period incurred is recorded as deferred cost of revenue.
Deferred cost of revenue is expensed in the statement of operations as cost of revenue when the corresponding revenue is recognized. Costs related to services are expensed in the period incurred. We reconcile cost of revenue to cost of billings by
adding cost of revenue to the change in deferred cost of revenue, less stock-based compensation and amortization of intangibles included in cost of revenue, in a given period.

Gross profit (loss) on billings is the difference between
billings and cost of billings.

Adjusted EBITDA is
net loss adjusted for changes in deferred revenue and deferred cost of revenue, other (income) expense, net, provision for income taxes, depreciation and amortization, stock-based compensation and certain other items management believes affect the
comparability of operating results.

The non-GAAP financial measures set forth below for the years ended December 31,
2009, 2010 and 2011 have been derived from our audited financial statements. The non-GAAP financial measures for the nine months ended September 30, 2011 and 2012 have been derived from our unaudited consolidated financial statements included
elsewhere in this prospectus. Reconciliations to the comparable GAAP measures are contained in the notes below.

The following table reconciles gross profit (loss) to gross profit on billings:

Year Ended December 31,

Nine Months EndedSeptember
30,

2009

2010

2011

2011

2012

(unaudited, in thousands)

Gross profit (loss)

$

(36,763

)

$

(50,024

)

$

22,951

$

11,887

$

21,171

Deferred revenue, end of period

210,247

401,381

400,460

408,978

472,551

Less: Deferred revenue, beginning of period

(17,937

)

(210,247

)

(401,381

)

(401,381

)

(400,460

)

Less: Deferred cost of revenue, end of period

(158,463

)

(257,494

)

(206,303

)

(223,561

)

(227,170

)

Deferred cost of revenue, beginning of period

10,916

158,463

257,494

257,494

206,303

Stock-based compensation included in cost of revenue

205

1,411

3,089

1,982

1,993

Amortization of intangibles included in cost of revenue



160

192

144

144

Gross profit on billings

$

8,205

$

43,650

$

76,502

$

55,543

$

74,532

(4)

The following table reconciles net loss to adjusted EBITDA:

Year Ended December 31,

Nine Months
EndedSeptember 30,

2009

2010

2011

2011

2012

(unaudited, in thousands)

Net loss

$

(113,463

)

$

(148,449

)

$

(92,359

)

$

(76,198

)

$

(68,707

)

Deferred revenue, end of period

210,247

401,381

400,460

408,978

472,551

Less: Deferred revenue, beginning of period

(17,937

)

(210,247

)

(401,381

)

(401,381

)

(400,460

)

Less: Deferred cost of revenue, end of period

(158,463

)

(257,494

)

(206,303

)

(223,561

)

(227,170

)

Deferred cost of revenue, beginning of period

10,916

158,463

257,494

257,494

206,303

Other (income) expense, net

13,212

2,553

(3,234

)

(1,670

)

(219

)

Provision for income taxes

180

146

363

253

469

Depreciation and amortization

1,896

5,162

6,958

5,233

5,459

Stock-based compensation

2,052

6,547

17,332

13,093

11,823

Legal settlements

4,500



1,000

1,000



Adjusted EBITDA

$

(46,860

)

$

(41,938

)

$

(19,670

)

$

(16,759

)

$

49

Non-GAAP measures
have limitations and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP. The most significant of these limitations include:



our non-GAAP measures do not reflect the effect of customer acceptance provisions as required under GAAP;



our non-GAAP measures do not reflect the effect of contingent revenue recognition limits due to potential refunds and penalty provisions related to
future delivery or performance as required under GAAP;



our non-GAAP measures are based on contractual invoiced amounts and therefore do not reflect the effect of relative selling price allocations between
separate units of accounting as required under GAAP;

our non-GAAP measures do not reflect the impact of issuing equity-based compensation to our management team and employees or in connection with
acquisitions;



our non-GAAP measures do not reflect the impact of the amortization of acquired intangibles arising from acquisitions;



our non-GAAP measures do not reflect other (income) expense primarily related to gains and losses from the remeasurement of embedded derivative and
preferred stock warrant liabilities, and interest expense from our convertible notes;



our non-GAAP measures do not reflect income tax expense or legal settlement costs;



although depreciation and amortization are non-cash expenses, the assets being depreciated and amortized may have to be replaced in the future, and
adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditures;

other companies, including companies in our industry, may not use such measures, may calculate non-GAAP measures differently or may use other financial
measures to evaluate their performance, all of which reduce the usefulness of our non-GAAP measures as comparative measures.

You should read the following discussion and analysis in
conjunction with the information set forth under Selected Consolidated Financial Data and our consolidated financial statements and related notes included elsewhere in this prospectus. The statements in this discussion regarding our
expectations of our future performance, liquidity and capital resources, and other non-historical statements in this discussion, are forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties,
including, but not limited to, the risks and uncertainties described under Risk Factors and elsewhere in this prospectus. Our actual results may differ materially from those contained in or implied by any forward-looking statements.

Business Overview

We provide a leading networking platform and solutions that
enable utilities to transform the power grid infrastructure into the smart grid. The smart grid intelligently connects millions of devices that generate, control, monitor and consume power, providing timely information and control to both utilities
and consumers. We believe that the application of networking technology to the power grid has the potential to transform the energy industry through better communication just as the application of networking technology to the computing industry
enabled the Internet.

We believe the power grid
is one of the most significant elements of contemporary industrial infrastructure that has yet to be extensively networked with modern technology. We were founded in 2002 to address this challenge, pioneering a fundamentally new approach to connect
utilities with millions of devices on the power grid. We believe our technology will yield significant benefits to utilities, consumers and the environment, both in the near term and the future. These benefits include more efficient management of
energy, improved grid reliability, capital and operational savings, the ability to pursue new initiatives, consumer empowerment, and assistance in complying with evolving regulatory mandates through reduced carbon emissions. We believe networking
the power grid will fundamentally transform the worlds relationship with energy.

The foundation of our technology is a standards-based and secure IP network. Our networking platform provides two-way communications between the utility back office and devices on the power grid. In
addition to our networking platform, we offer a suite of solutions that run on top of our network and complementary services, all of which we collectively refer to as our Smart Energy Platform. Our solutions include advanced metering, which
allows utilities to automate a number of manual processes and improve operational efficiencies, offer flexible pricing programs to consumers, and improve customer service with faster outage detection and restoration; distribution automation, which
provides utilities with real-time visibility into the health of the grid, enabling better management and control of power distribution assets to improve grid reliability; and demand-side management, which enables utilities to offer consumers a
variety of programs and incentives to use energy more efficiently and reduce usage at times of peak demand. Our service offerings include professional services to implement our products, managed services and SaaS, to assist utilities with managing
the network and solutions, and ongoing customer support. Our Smart Energy Platform comprises hardware, software and services and combines with devices manufactured by third-party partners to form end-to-end smart grid offerings. We have
architected our networking platform to support multiple current and future smart grid solutions. As a result, we believe utilities can increase the value of their network investment as they deploy additional solutions on this network.

We market our Smart Energy Platform directly to
utilities around the world. Leading utilities have selected our networking platform to be the foundation of the smart grid. According to an analysis prepared by IDC Energy Insights, we are the United States market leader for electric advanced
metering infrastructure communications, with 32% of homes and businesses awarded from 2002 through September 30, 2012. IDC Energy Insights prepared this analysis at our request and we paid a customary fee for its services. Since inception, we have
been awarded contracts to network more than 22 million Silver Spring-enabled devices that connect homes and businesses, of which more than 13 million have been networked as of October 31, 2012. Our utility customers, as of October 31, 2012,
include: Atlantic City Electric Company, a subsidiary of Pepco Holdings Inc., or PHI;

For the years ended December 31, 2009, 2010 and 2011 our
total revenue was $3.3 million, $70.2 million and $237.1 million, respectively. In the same periods, we generated billings of $195.6 million, $261.4 million and $236.1 million, respectively. For the nine months ended September 30,
2011 and 2012, our total revenue was $175.7 million and $146.7 million, respectively, and our billings were $183.3 million and $218.8 million, respectively. In addition, for the years ended December 31, 2009, 2010 and 2011 and
the nine months ended September 30, 2012, we incurred gross profit (loss) of $(36.8) million, $(50.0) million, $23.0 million and $21.2 million, respectively, and incurred net loss of $(113.5) million, $(148.4) million, $(92.4) million
and $(68.7) million, respectively. To date, a substantial majority of our revenue and billings has been attributable to a limited number of utility customer deployments of our networking platform and advanced metering solution. Our distribution
automation, energy efficiency and demand response solutions are being piloted and deployed by some of our utility customers and, to date, we have recognized limited revenue and billings on these solutions as compared with those of our advanced
metering solution. Please see Selected Consolidated Financial MeasuresOther Financial Data and Managements Discussion and Analysis of Financial Conditions and Results of OperationsKey Elements of Operating and
Financial Performance for more information on billings.

Key Milestones

In 2002, we founded the company with a vision of developing a networking platform that allows utilities to transform the power grid
infrastructure into the smart grid. We have delivered our Smart Energy Platform to a number of industry-leading utilities and our objective is to become the industry standard for utilities worldwide. Key milestones in our development include:

2007 to 2008



In 2007, we launched our first large-scale pilot with FPL to network 100,000 homes and businesses in south Florida. The success of this project led to
a full deployment agreement for our networking platform and advanced metering solution across FPLs entire service territory encompassing more than four million homes and businesses.



In 2008, after successful completion of a pilot program, we entered into an agreement with PG&E for the full deployment of our networking platform
and advanced metering solution encompassing more than five million homes and businesses across PG&Es more than 70,000 square-mile service territory.



In 2008, we signed the first agreement for the sale of our distribution automation solution.



We signed additional agreements with three utility customers representing over 1 million homes and businesses, including our first international
customer (in Australia).

2009



We signed additional agreements with four utility customers representing approximately 4.4 million homes and businesses.

In the second half of 2009, we began investing more heavily in our managed services and SaaS infrastructure to support our customer deployments. We
subsequently signed our first long-term managed services agreements in 2010 with PG&E and FPL.



In October 2009, we acquired Greenbox Technology, an innovative provider of a consumer-facing web portal that evolved into CustomerIQ, a cornerstone of
our demand-side management solution.



As of December 31, 2009, our utility customers had networked approximately 2.0 million Silver Spring-enabled devices that connect homes and
businesses using our networking platform.

2010



We signed additional agreements with two utility customers representing approximately 2.0 million homes and businesses.



We deployed the first large pilot of our demand-side management solution in support of OG&Es Smart Energy Together peak reduction program.



We established an office and added personnel in Brazil, as well as hired our first employees in Europe. We also deployed our first pilot programs in
Brazil and Europe.



As of December 31, 2010, our utility customers had networked 5.9 million Silver Spring-enabled devices that connect homes and businesses
using our networking platform.

2011



We announced an expanded relationship with OG&E, in which our demand response and energy efficiency solutions became available to the 775,000 homes
and businesses in OG&Es service territory.



We released an updated version of UtilityIQ Demand Response Manager that supports management of electric vehicle charging, allowing utilities to
understand where electric vehicles are in their territory, monitor the load created by charging them, and manage the charging to smooth out that increased load.



In December 2011, in connection with a strategic investment by EMC, we entered into a memorandum of understanding to deliver a smart grid analytics
solution to empower utilities with advanced insights from the data generated from the millions of devices on the smart grid.



As of December 31, 2011, our utility customers had networked more than 10 million Silver Spring-enabled devices that connect homes and
businesses using our networking platform.

2012



We signed additional agreements with three utility customers representing more than four million homes and businesses.



We announced Gen4, our next-generation networking technology, which is available in some products today, with more products coming later this year and
next year. The technology features a modular architecture and will support faster performance, more memory, and an integrated cellular option, adding more flexibility and choice for our utility customers.



In February 2012, in connection with a strategic investment by Hitachi, we entered into a memorandum of understanding to collaborate on joint
opportunities in the areas of smart grid and smart city in Japan and other regions, and in September 2012, entered into a master collaboration agreement with Hitachi based on such memorandum of understanding.



We announced a full deployment covering industrial customers with CPFL Energia, the deployment of a pilot project in São Paulo, Brazil with AES
Eletropaulo and an expansion of our pilot project in New Zealand with WEL Networks.

Since inception through September 30, 2012, we have completed four deployments of our networking platform and advanced metering solution. Three of
these customers are piloting or have purchased additional solutions and services.



As of October 31, 2012, our utility customers had networked more than 13 million Silver Spring-enabled devices that connect homes and businesses
using our networking platform, and we had over 35 pilot projects in progress across the United States, Australia, New Zealand, South America and Europe.

Factors Affecting Our Performance

The Pace of Smart Grid Adoption

Our financial performance is correlated to the pace of
adoption of the smart grid in the utility industry. The adoption of the smart grid in the United States is evolving and is impacted by multiple factors. In 2010, the rate of smart grid adoption slowed due to uncertainty surrounding the timing and
tax treatment of U.S. government stimulus funding, negative publicity and consumer opposition, and regulatory investigations. These uncertainties caused many potential utility customers that had been considering smart grid programs in the
United States to further evaluate their smart grid initiatives and delay their procurement processes or extend their deployment schedules. Smart grid adoption in international markets has trailed adoption in the United States as international
markets continue to explore the technology and define the benefits and regulatory requirements for the smart grid. These factors resulted in lower billings in 2011 when compared to 2010, and, in the first quarter of 2012 compared to the first
quarter of 2011. Lower billings will have a corresponding negative impact on future revenue. We have seen an increase in smart grid-related requests for proposal on a global basis and believe many utilities will move forward with their smart grid
initiatives; however, the pace and degree of adoption cannot be determined with certainty.

Long and Unpredictable Sales Cycles and Limited Number of Customers

Sales cycles with utilities tend to be long and unpredictable. Sales cycles can be subject to multiple trial deployments, or pilots,
before a full deployment contract is awarded, with no assurance that our networking platform and solutions will be selected. Our utility customers also typically need to obtain regulatory approval for these deployments. In addition, a substantial
majority of our billings, revenue and cash flows depend on relatively large sales to a limited number of utility customers. As a result of our lengthy sales cycle and relatively large sales to a small number of customers, our billings, revenue and
operating results can fluctuate significantly from period to period.

Customer Acceptance Provisions Impact Timing of Revenue Recognition

Our sales are generally made pursuant to MSAs. Our customer arrangements provide that we may bill and collect for products when ownership
has transferred and for services when they have been provided. We typically cannot, however, recognize revenue before customer acceptance is received. Our MSAs for each customer include initial acceptance provisions, followed by subsequent
acceptances as the deployment progresses. The time to achieve these specific performance levels varies based on several factors, which may include the size and density of a utilitys service territory and the complexity of a utilitys
deployment plan. Until acceptance and all other revenue recognition criteria have been met, our billings are recorded as deferred revenue. Accordingly, we manage our business, make planning decisions, and evaluate our performance by assessing
billings, which are closely aligned with our sales volume and trends, and cash flow characteristics of our business. For the years ended December 31, 2009, 2010 and 2011, our total revenue was $3.3 million, $70.2 million and
$237.1 million, respectively. For the nine months ended September 30, 2011 and 2012, our total revenue was $175.7 million and $146.7 million, respectively. For the years ended December 31, 2009, 2010 and 2011, we generated
billings of $195.6 million, $261.4 million and $236.1 million, respectively. For the nine months ended September 30, 2011 and 2012, we generated billings of $183.3 million and $218.8 million, respectively. See Selected
Consolidated Financial DataOther Financial Measures for more information on billings.

The sale of our hardware is the primary driver of our
product revenue. We outsource the manufacturing of our hardware products to third-party contract manufacturers. Accordingly, a significant portion of our cost of revenues and substantially all of our deferred costs consist of payments to our
contract manufacturers. Our contract manufacturers generally secure capacity and procure component inventory on our behalf based on a rolling forecast. To protect against component shortages and to provide replacement parts for our service teams, we
manage our supply chain with third-party contract manufacturers to establish adequate quantities of key components. As part of our design review process, we also attempt to identify alternative or substitute parts for single-source components to
further mitigate the risk of shortages.

Although
we gain significant benefits from outsourcing manufacturing, it results in less control over the manufacturing process, exposing us to risks, including reduced control over quality assurance, product costs and product supply. For example, in
March 2010, we discovered a faulty capacitor used by a contract manufacturer in a version of our communications module, resulting in charges to cost of product revenue of $6.3 million and $12.5 million in the year ended December 31, 2009 and
the three months ended March 31, 2010, respectively. Since then, we have worked with our supply chain and third-party contract manufacturers to improve our manufacturing quality control programs and our supply chain component qualification and
sourcing programs. We intend to continue to invest in these programs in an effort to reduce costs, improve quality and increase the capacity of our manufacturing process.

Product Costs

Our objective is to continue decreasing product costs
and improving product gross margins through engineering design cost reductions, higher volume purchasing of our hardware, elimination of single-source parts and additional economies of scale. We leverage the production capacity of our
third-party contract manufacturers to maintain production volume capacity and benefit from their volume component buying power. This allows us to preserve flexibility over our supply chain, while committing to minimum production volumes. Our gross
margins on billings increased from 17% to 32% for the years ended December 31, 2010 and 2011, respectively and further increased to 34% for the nine months ended September 30, 2012, primarily due to increased product gross margin. For the
years ended December 31, 2010, 2011, and for the nine months ended September 30, 2012, on a GAAP basis, our gross margins were (71)%, 10%, and 14%, respectively. See Selected Consolidated Financial DataOther Financial Measures
for more information on cost of billings and gross profit (loss) on billings. We have experienced significant increases in our gross margins in the past, but do not expect the rate of increase to continue in future periods. Furthermore, we expect
gross margins to fluctuate from period to period. See Key Quarterly Elements of Financial Performance for more information.

International Expansion

Our future growth will depend, in part, on our ability to increase sales of our Smart Energy Platform internationally.
Historically, the majority of our revenue and billings have been generated from the United States. In 2011, international utility customers accounted for 5% of revenue and 16% of our billings, compared to 3% of our revenue and 16% of our billings in
2010. For the nine months ended September 30, 2012, international utility customers accounted for 8% of revenue and 14% of our billings, compared to 5% of our revenue and 18% of our billings for the nine months ended September 30,
2011. We intend to aggressively pursue new utility customers internationally, which may increase operating expenses in the near term and may not result in revenues or billings until future periods, if at all.

Investments in Growth

We believe the smart grid market is still in its infancy and
our objective is to continue to invest for long-term growth. We expect to continue to invest heavily in our research and development initiatives to expand the capabilities of our Smart Energy Platform. In addition, we expect to continue to
aggressively expand our sales

organization and partnerships to market our solutions both in the United States and internationally. We expect to continue to incur losses in future periods as we continue to invest in our
growth.

Key Elements of Operating and Financial Performance

We monitor the key elements of our operating
and financial performance set forth below to help us evaluate growth trends, determine investment priorities, establish budgets, measure the effectiveness of our sales efforts and assess operational efficiencies. These key elements of operating and
financial performance include certain non-GAAP measures which consist of billings, cost of billings and gross profit (loss) on billings. For more information regarding our use of non-GAAP measures, see Selected Consolidated Financial
DataOther Financial Measures.

Revenue

We derive revenue from sales of products and services that enable utility customers to deploy our Smart Energy Platform. In 2011,
product revenue represented 90% and service revenue represented 10% of our total revenue.

Our product revenue is derived from sales of hardware such as communications modules, access points, relays and bridges, and software. To date, in our typical utility customer deployments, we have sold
our communications modules to meter manufacturers and our other hardware and software products directly to our utility customers. However, when requested by our utility customers, we have sold third-party devices such as meters integrated with our
communications modules directly to our utility customers.

Our service revenue includes fees for professional services, managed services and SaaS, and ongoing customer support.

To date, a substantial majority of our revenue is
attributable to a limited number of utility customer deployments of our advanced metering solution. In 2011, the deployments for PG&E, FPL and SMUD represented 34%, 26% and 12% of our revenue, respectively.

Each of these total revenue percentages includes amounts
related to the utility customers deployments that were billed directly to our meter manufacturers, as well as direct revenue from our utility customers. We expect that a limited number of utility customers will continue to account for a
substantial portion of our revenue in future periods although these utility customers have varied and are likely to vary from period to period.

Billings

Billings represent amounts invoiced for products for which ownership, typically evidenced by title and risk of loss, has transferred or
services that have been provided to the customer, and for which payment is expected to be made in accordance with normal payment terms. Billings exclude amounts for undelivered products, services to be performed in the future, and amounts paid or
payable to customers. Billings are initially recorded as deferred revenue and are recognized as revenue when all revenue recognition criteria have been met under our accounting policies as described in Critical Accounting Policies and
EstimatesRevenue Recognition. We reconcile revenue to billings by adding revenue to the change in deferred revenue in a given period.

To date, a substantial portion of our billings is attributable to deployments by a small number of utility customers and to sales of our
communications modules to meter manufacturers that fulfill the meters for deployments attributable to these utility customers. In 2011, the deployments for FPL, PG&E, SMUD and CHED represented 28%, 13%, 11% and 10% of our billings, respectively.

Each of these total billings percentages includes
amounts related to the utility customers deployments that were billed directly to our meter manufacturers, as well as direct billings to our utility customers.

Product cost of revenue consists of contract manufacturing
costs, including raw materials, component parts and associated freight, and normal yield loss in the period in which we recognize the related revenue. In addition, product cost of revenue includes compensation, benefits and stock-based compensation
provided to our supply chain management personnel, and overhead and other direct costs, which are recognized in the period in which we recognize the related revenue. Further, we recognize certain costs, including logistics costs, manufacturing
ramp-up costs, expenses for inventory obsolescence, warranty obligations, lower of cost or market adjustments to inventory, and amortization of intangibles, in the period in which they are incurred or can be reasonably estimated. We record a lower
of cost or market adjustment in instances where the selling price of the products delivered or expected to be delivered is less than cost. We also include the cost of third-party devices in cost of revenue in instances when our utility customers
contract with us directly for such devices. In accordance with our accounting policies, we recognize product cost of revenue in the periods we recognize the related revenue.

Service cost of revenue includes compensation and related
costs for our service delivery, customer operations and customer support personnel, facilities and infrastructure cost and depreciation, and data center costs. In accordance with our accounting policies, we recognize service cost of revenue in the
period in which it is incurred even though the associated service revenue may be required to be deferred as described under Critical Accounting Policies and EstimatesRevenue Recognition.

Our gross profit (loss) varies from period to period based on
the volume, average selling prices, and mix of products and services recognized as revenue, as well as product and service costs, expense for warranty obligations, and inventory write-downs. The timing of revenue recognition and related costs, which
depends primarily on customer acceptance, can fluctuate significantly from period to period and have a material impact on our gross profit and gross margin results.

Cost of Billings and Gross Profit on Billings

Cost of billings represents the cost
associated with products and services that have been delivered to the customer, excluding stock-based compensation and amortization of acquired intangibles. Cost of hardware shipments for which revenue is not recognized in the period incurred is
recorded as deferred cost of revenue. Deferred cost of revenue is expensed in the statement of operations as cost of revenue when the corresponding revenue is recognized. Costs related to invoiced services are expensed in the period incurred. We
reconcile cost of revenue to cost of billings by adding cost of revenue and the change in deferred cost of revenue, less stock-based compensation and amortization of intangibles, included in cost of revenue in a given period.

Gross profit on billings is the difference between billings
and cost of billings.

Operating Expenses

Operating expenses consist of
research and development, sales and marketing, and general and administrative expenses, as well as legal settlement expenses and amortization of acquired intangibles. Personnel-related expense represents a significant component of our operating
expenses. Our regular full-time employee headcount grew from 394 as of December 31, 2009 to 574 as of December 31, 2010 and decreased to 567 as of December 31, 2011. We had 570 regular full-time employees as of September 30, 2012.

Research and Development

Research and development expense
represents the largest component of our operating expenses and consists primarily of:



compensation, benefits and stock-based compensation provided to our hardware and software engineering personnel, as well as facility costs and other
related overhead;

Of the
$146.7 million total revenue recognized in the nine months ended September 30, 2012, 94%, or $138.4 million, was due to the receipt of customer acceptances and the performance of related services for follow-on phases of deployment of
our networking platform and solutions from utility customers for which acceptance of initial phases of deployment was achieved prior to 2012, and 6%, or $8.3 million, was due to the receipt of customer acceptances of initial phases of
deployment of our networking platform and solutions during 2012. Revenue from our advanced metering, and demand-side management and distribution automation solutions represented 88% and 12%, respectively, of total revenue for the nine months ended
September 30, 2012.

Of the
$175.7 million total revenue recognized in the nine months ended September 30, 2011, 67%, or $118.5 million, was due to the receipt of customer acceptances and the performance of related services for follow-on phases of deployment of
our networking platform and solutions from utility customers for which acceptance of initial phases of deployment was achieved prior to 2011, and 33%, or $57.2 million, was due to the receipt of customer acceptances of initial phases of
deployment during 2011. Revenue from our advanced metering and demand-side management and distribution automation solutions represented 99% and 1%, respectively, of revenue for the nine months ended September 30, 2011.

Product Revenue. The $36.6 million decrease in
product revenue for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 was primarily due to a decrease in the receipt of customer acceptances of initial phases of deployment during 2012,
partially offset by an increase in the receipt of customer acceptances for follow-on phases of deployment from utility customers for which acceptance of initial phases of deployment was achieved prior to 2012.

Service Revenue. The $7.6 million increase in
service revenue for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 was due to a $6.2 million increase in professional services and a $1.4 million increase in managed services and SaaS.
Revenue from managed services and SaaS, and professional services represented 8% and 8%, respectively, of total revenue for the nine months ended September 30, 2012, and 6% and 3%, respectively, of total revenue for the nine months ended
September 30, 2011.

We anticipate that
revenue during the fourth quarter of 2012 may be significantly lower than the three months ended September 30, 2012 and the fourth quarter of 2011 primarily due to the timing of when we expect to meet the completion and acceptance criteria in our
customer arrangements and the continued impact of lower billings in 2011 as described above under Factors Affecting Our Performance.

The following table sets forth our reconciliation of revenue
to billings for the periods shown:

Nine Months EndedSeptember
30,

2011

2012

Change

(unaudited, in thousands)

Revenue, net

$

175,716

$

146,666

$

(29,050

)

Deferred revenue, end of period

408,978

472,551

63,573

Less: Deferred revenue, beginning of period

(401,381

)

(400,460

)

921

Billings

$

183,313

$

218,757

$

35,444

The
$35.4 million increase in billings for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 was due to increases in billings of $22.1 million from product billings, $8.6 million from
professional services billings and $4.7 million for managed services and SaaS billings.

Billings from our advanced metering, and demand-side management and distribution automation solutions represented 92% and 8%, respectively, of total billings for the nine months ended September 30,
2012, and 94% and 6%, respectively, of total billings for the nine months ended September 30, 2011.

Billings from product, managed services and SaaS, and professional services represented 78%, 11% and 11%, respectively, of total billings
for the nine months ended September 30, 2012, and 81%, 10% and 9%, respectively, of total billings for the nine months ended September 30, 2011.

Cost of Revenue and Gross Profit

The following table sets forth our cost of revenue and gross profit for the periods shown:

Nine Months EndedSeptember
30,

2011

2012

Change

(unaudited, in thousands)

Product cost of revenue

$

128,022

$

88,358

$

(39,664

)

Service cost of revenue

35,807

37,137

1,330

Cost of revenue

$

163,829

$

125,495

$

(38,334

)

Product gross profit

$

30,894

$

33,934

$

3,040

Service gross profit (loss)

(19,007

)

(12,763

)

6,244

Gross profit

$

11,887

$

21,171

$

9,284

Product Cost of
Revenue. The $39.7 million decrease in product cost of revenue for the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 was primarily due to a $25.7 million decrease resulting from
a decrease in accepted hardware products and a change in mix of hardware products and a $14.7 million decrease resulting from lower cost hardware products and component pricing for which revenue was recognized.

Service Cost of Revenue. Service cost of revenue in
the nine months ended September 30, 2012 increased slightly as compared to the nine months ended September 30, 2011. Changes in our service cost of revenue are disproportionate to changes in our service revenue because we recognize service
cost of revenue in the period in which it is incurred even though the associated service revenue may be required to be deferred, as described under Key Elements of Operating and Financial PerformanceCost of Revenue and Gross Profit
(Loss).

We expect cost of revenue related to personnel related expenses to increase in future
periods in connection with restricted stock units that vest upon an initial public offering, equity awards that will be granted on the day this registration statement is declared effective and that were communicated to employees, but not granted,
during the period between February 2012 and the date of this prospectus, the modification of stock options held by current employees and directors as of the date of this offering with an exercise price of $6.98 per share or greater, and the expected
grant of additional equity awards, primarily in the form of restricted stock units, to existing employees, including officers, shortly following the closing of this offering.

Cost of Billings and Gross Profit on Billings

The following table sets forth our
reconciliation of cost of revenue to cost of billings for the periods shown:

Nine Months EndedSeptember
30,

2011

2012

Change

(unaudited, in thousands)

Cost of revenue

$

163,829

$

125,495

$

(38,334

)

Deferred cost of revenue, end of period

223,561

227,170

3,609

Less: Deferred cost of revenue, beginning of period

(257,494

)

(206,303

)

51,191

Less: Stock-based compensation included in cost of revenue

(1,982

)

(1,993

)

(11

)

Less: Amortization of intangibles included in cost of revenue

(144

)

(144

)



Cost of billings

$

127,770

$

144,225

$

16,455

Cost of billings
increased by $16.5 million during the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 primarily due to a net increase of $17.1 million in product costs of hardware shipped partially offset
by lower volumes.

The following table sets
forth our reconciliation of gross profit to gross profit on billings for the periods shown:

Nine Months
EndedSeptember 30,

2011

2012

Change

(unaudited, dollars in thousands)

Gross profit

$

11,887

$

21,171

$

9,284

Deferred revenue, end of period

408,978

472,551

63,573

Less: Deferred revenue, beginning of period

(401,381

)

(400,460

)

921

Less: Deferred cost of revenue, end of period

(223,561

)

(227,170

)

(3,609

)

Deferred cost of revenue, beginning of period

257,494

206,303

(51,191

)

Stock-based compensation included in cost of revenue

1,982

1,993

11

Amortization of intangibles included in cost of revenue

144

144



Gross profit on billings

$

55,543

$

74,532

$

18,989

Gross margin on billings

30

%

34

%

Gross profit on
billings increased by $19.0 million during the nine months ended September 30, 2012 as compared to the nine months ended September 30, 2011 primarily due to increases in gross profit on billings of $12.0 from managed services and SaaS
and professional services, and $7.0 million from product.

For the nine months ended September 30, 2012, gross margin on billings was 34% as compared with 30% for the comparable period in 2011. The gross margin improvement was driven primarily by an increase in
billings attributable to professional services, managed services and SaaS and an increase in billings for software. In addition, gross margin on billings in the nine months ended September 30, 2011 was negatively impacted by a

$2.5 million charge against billings for estimated amounts payable to a customer in connection with a product repair program. We expect gross margin on billings to fluctuate from period to period
throughout 2012. See Key Quarterly Elements of Financial Performance for more information.

Operating Expenses

The following table sets forth our operating expenses for the periods shown:

Nine Months EndedSeptember
30,

2011

2012

Change

(unaudited, in thousands)

Research and development

$

42,874

$

46,872

$

3,998

Sales and marketing

18,725

21,732

3,007

General and administrative

26,804

21,024

(5,780

)

Legal settlements and amortization of acquired intangibles

1,099



(1,099

)

Operating expenses

$

89,502

$

89,628

$

126

Personnel-related
expenses represent the most significant component of our operating expenses and increased from period to period. In the near term, we intend to continue to manage our operating expenses in line with our existing cash and available financial
resources and anticipate increased spending in future periods in order to execute our long-term business plan. We expect personnel related expenses to increase in future periods in connection with restricted stock units that vest upon an initial
public offering, equity awards that will be granted on the day this registration statement is declared effective and that were communicated to employees, but not granted, during the period between February 2012 and the date of this prospectus, the
modification of stock options held by current employees and directors as of the date of this offering with an exercise price of $6.98 per share or greater, and the expected grant of additional equity awards, primarily in the form of restricted stock
units, to existing employees, including officers, shortly following the closing of this offering.

In any particular period, the timing of additional hires could materially affect our operating expenses, both in absolute dollars and as a
percentage of revenue. There was $5.2 million of unrecognized stock-based compensation expense related to performance-based awards as of September 30, 2012, of which $4.5 million is expected to be incurred in connection with the
completion of this offering.

Research and
Development. The $4.0 million increase in research and development expense for the nine months ended September 30, 2012 was primarily due to an increase of $3.0 million in personnel-related expense.

We intend to continue to invest significantly in our research
and development efforts, which we believe are essential to enhancing our competitive position and developing new products. Accordingly, we expect research and development expense to increase in future periods and remain the largest component of our
operating expenses.

Sales and Marketing.
The $3.0 million increase in sales and marketing expense for the nine months ended September 30, 2012 was primarily due to an increase of $2.5 million in personnel-related and commission expense.

We expect sales and marketing expense to increase in future
periods as we hire new personnel and increase our global marketing and sales activities.

General and Administrative. The $5.8 million decrease in general and administrative expense for the nine months ended September 30, 2012 was due to a $2.5 million expense recorded in the nine
months ended September 30, 2011 for the issuance of a fully-vested common stock warrant to purchase 250,000 shares of our common stock related to the establishment of a charitable foundation following this offering. In addition, we

realized a $1.9 million decrease in legal and other professional advisory fees, and $1.4 million decrease in personnel-related expense in the nine months ended September 30, 2012 due primarily to
a decrease in headcount.

We expect general
and administrative expense to increase as we incur additional costs related to operating as a publicly-traded company including increased audit, legal, regulatory and other related fees.

Operating Loss

The following table sets forth our operating losses for the
periods shown:

Nine Months
EndedSeptember 30,

2011

2012

Change

(unaudited, in thousands)

Operating loss

$

(77,615

)

$

(68,457

)

$

9,158

Operating loss
consists of gross profit less operating expenses. The $9.2 million decrease in operating loss for the nine months ended September 30, 2012 was primarily due to a $9.3 million increase in gross profit.

We expect to continue to incur operating losses in future
periods as we continue to invest in our growth.

Other Income (Expense), Net

The following table sets forth our other income (expense), net, for the periods shown:

Nine MonthsEndedSeptember
30,

2011

2012

Change

(unaudited, in thousands)

Interest income

$

14

$

4

$

(10

)

Interest expense

(150

)

(3,077

)

(2,927

)

Other gain (loss), net

13

(278

)

(291

)

Remeasurement of preferred stock warrants and embedded derivatives

1,793

3,570

1,777

Other income, net

$

1,670

$

219

$

(1,451

)

Other income
(expense), net, consists primarily of changes in the fair value of our preferred stock warrants and embedded derivatives, interest expense on our capital leases and convertible notes payable, interest income on cash balances and foreign
currency-related gains and losses. We have historically invested our cash in money market accounts and U.S. Treasury bills.

The change in the remeasurement of preferred stock warrant liability in the nine months ended September 30, 2012 was primarily due to
a decrease in our enterprise value.

Net loss consists of operating loss plus other income (expense), net, less provision for
income taxes. The $7.5 million decrease in net loss for the nine months ended September 30, 2012 was primarily due to a $9.2 million decrease in operating loss. The provision for income taxes for both the nine months ended
September 30, 2012 and September 30, 2011 was inconsequential.

We expect to continue to incur net losses in future periods as we continue to invest in our growth.

Years Ended December 31, 2011, 2010 and 2009

Revenue

The following table sets forth our revenue for the periods shown:

Year Ended December 31,

Change in2010

Change in2011

2009

2010

2011

(in thousands)

Product revenue

$

2,344

$

65,936

$

212,317

$

63,592

$

146,381

Service revenue

953

4,288

24,733

3,335

20,445

Revenue, net

$

3,297

$

70,224

$

237,050

$

66,927

$

166,826

Of the $237.1 million total
revenue recognized in 2011, 71%, or $167.7 million, was due to the receipt of customer acceptances and the performance of related services for follow-on phases of deployment of our networking platform and advanced metering solution from utility
customers for which acceptance of initial phases of deployment was achieved prior to 2011, and 29%, or $69.4 million, was due to the receipt of customer acceptances of initial phases of deployment during 2011. Revenue from our advanced metering, and
demand-side management and distribution automation solutions represented 97% and 3% respectively, of total revenue for the year ended December 31, 2011.

Of the $70.2 million total revenue recognized in 2010, 62%, or $43.9 million, was due to the receipt of customer acceptances for the
initial phase of deployment of our networking platform and advanced metering solution. Substantially all revenue for 2009 was due to the receipt of customer acceptances for initial phases of deployment. Revenue from our advanced metering solution
represented 100% of total revenue for the years ended December 31, 2010 and 2009.

Product Revenue. The $146.4 million increase in product revenue in 2011 as compared to 2010 was primarily due to an increase of $145.5 million in revenue from accepted hardware related to our
networking platform and advanced metering solution.

The $63.6 million increase in product revenue in 2010 as compared to 2009 was primarily due to increases of $59.3 million and $4.3 million
from accepted hardware and software, respectively, related to our networking platform and advanced metering solution.

Service Revenue. The $20.4 million increase in service revenue in 2011 as compared to 2010 was primarily due to a $13.1 million
increase in managed services and SaaS, and a $7.3 million increase in professional services.

The $3.3 million increase in service revenue in 2010 as compared to 2009 was due to a $2.7 million increase in professional services and a $0.6 million increase in managed services and SaaS. Revenue from
managed services and SaaS, and professional services represented 6% and 5%, respectively, of total revenue for the year ended December 31, 2011, 2% and 4%, respectively, of total revenue for the year ended December 31, 2010, and 18% and 11%,
respectively, of total revenue for the year ended December 31, 2009.

In 2011, the deployments for PG&E, FPL and SMUD represented 34%, 26% and 12% of our
revenue, respectively. In 2010, the deployments for FPL, PG&E, and MID represented 37%, 33%, and 21% of our revenue, respectively.

We anticipate that revenue may decrease in 2012 compared to 2011 due to the timing of when we meet the completion and acceptance criteria
in our customer arrangements and the continued impact of lower billings in 2011 as described above under Factors Affecting Our Performance.

Billings

The following table sets forth our reconciliation of revenue to billings for the periods shown:

Year Ended December 31,

Change
in2010

Change
in2011

2009

2010

2011

(unaudited, in thousands)

Revenue, net

$

3,297

$

70,224

$

237,050

$

66,927

$

166,826

Deferred revenue, end of period

210,247

401,381

400,460

191,134

(921

)

Less: Deferred revenue, beginning of period

(17,937

)

(210,247

)

(401,381

)

(192,310

)

(191,134

)

Billings

$

195,607

$

261,358

$

236,129

$

65,751

$

(25,229

)

The $25.2 million decrease in
billings in 2011 as compared to 2010 was primarily due to a decrease in billings for hardware shipments and changes in the mix of hardware products shipped of $39.2 million compared to 2010 and a $2.5 million charge against billings in 2011 for
estimated amounts payable to a customer in connection with a product repair program, partially offset by increases in billings of $8.2 million for managed services and SaaS, $5.1 million for professional services and $3.2 million for software
licenses. The decrease in hardware shipments compared to 2010 was primarily attributable to one customer that required fewer hardware shipments as it is nearing the completion of its deployment of our networking platform and advanced metering
solution, which was partially offset by increased hardware product billings for shipments to several other customers as they increased their respective deployments of our networking platform and advanced metering solution. Billings related to the
deployments for FPL, PG&E, SMUD and CHED represented approximately 28%, 13%, 11% and 10% of billings in 2011.

The $65.8 million increase in billings in 2010 was primarily due to increases of $53.3 million in hardware shipments and $11.1 million of
professional services. Billings related to the deployments for PG&E, FPL, subsidiaries of PHI, and CHED represented, approximately 39%, 19%, 12% and 10% of billings in 2010. Billings to international utility customers represented 16% of billings
in 2010.

Billings from our advanced metering, and
demand-side management and distribution automation solutions represented 94% and 6%, respectively, of total billings for the year ended December 31, 2011, 98% and 2%, respectively, of total billings for the year ended December 31, 2010, and 100% and
0%, respectively, of total billings for the ended December 31, 2009.

Billings from product, managed services and SaaS, and professional services represented 79%, 11% and 10%, respectively, of total billings for the year ended December 31, 2011, 86%, 6% and 8%,
respectively, of total billings for the year ended December 31, 2010, and 91%, 4% and 5%, respectively, of total billings for the year ended December 31, 2009.